European logistics investment tops €15b in 2013: JLL

Investment in European logistics and industrial assets rose 73% to €15.3 bn last year, the highest volume since the 2006 peak of just over €16 bn, according to figures from Jones Lang LaSalle.

The firm expects volumes in 2014 to surpass 2006 levels.

‘The spike in volumes was fuelled by an improving macroeconomic landscape, falling vacancy levels, a tightening of supply and occupational demand driven by factors such as the continued growth of e-commerce and changing shape of retail markets,’ said Tom Waite, director of European capital markets for JLL.

‘This has led to some downward yield movements in a number of markets, which we expect to see continuing in 2014.’

The core markets of the UK, Germany and France continued to see most activity in 2013, however a lack of prime product and declining yields prompted investors to look elsewhere. Some 45% of total investment was outside the big three markets, up from 30% the previous year.

The Nordic (+84%) and Benelux (+44%) countries saw a substanital increase in volumes, while investments rose by 12% in the 'southern periphery', mainly driven by Italy.

Volumes in Russia hit a record €800 mln in 2013, up 137%, but the market continues to be dominated by a small number of domestic investors.

Logistics and industrial investment accounted for 10% of total commercial real estate volumes, up from a five-year average of 8%, according to JLL.