Further explosive growth in online shopping over the next few years will continue to spur demand for logistics property in Europe, new research from Savills shows.
Further explosive growth in online shopping over the next few years will continue to spur demand for logistics property in Europe, new research from Savills shows.
The adviser estimates that some 8.7 million m2 of logistics property will be required across Europe by 2020, with demand driven by a surge in online shopping, retail consolidation and major food retailers servicing consumers in different ways.
The rising value of Europe’s online retail market, from €112 bn to a forecast €233.9 bn over the next three years according to a study from Forrester, will see the take-up of logistics space continue to soar, Savills said.
‘While the assumption might be that occupiers would concentrate on large units in centres of countries and continents, we are experiencing a surge in demand from parcel delivery companies looking for smaller units on the edge of conurbations as they struggle to get to grips with urban logistics,’ said Richard Sullivan, national head of industrial and logistics at Savills. ‘Additionally, with reports suggesting up to 40% of goods ordered online are returned, a whole new asset class is emerging in the form of the returns centre,’ he added.
Logistics investment volumes rose 29% to €30 bn in Europe over 2014, well above the long-term average of €22.2 bn and almost as high as the record €39.9 bn registered in 2007, according to Savills data. Trading activity was largely dominated by the economies of Western Europe, with the UK and Germany accounting for 54% of all logistics investment across the continent last year.
Click on the attachment below to read the full Savills report