Rents for logistics warehouses jumped by 8.4% globally between June 2021 and June 2022, driven by increased demand for space in the wake of the pandemic, new research from Savills reveals.
The Savills report, which covers 52 markets, indicates that land constraints in cities, where industrial logistics use competes with other uses and supply is scarce, have kept prime warehouse availability rates below 3%.
London is the most expensive city, with prime rents reaching $54/m2 (€54), including rent, service charges and taxes, followed by Hong Kong ($26) and Tokyo ($22).
Logistics warehouse rents in Europe have risen by 6.7% on average over the past year, with the exception of Prague, where the price has soared by 35.8% due to exceptionally low availability rates and its location as a nearshoring centre for many European companies.
The price of rent is only one of the costs that customers take into account when choosing a place, according to Savills, who also note that the cost of labour has increased by 6% internationally in the past year and that the price of electricity and fuel has grown by 39.4%.
Declining consumer confidence and rising energy and labour costs have yet to impact demand and rents for these assets, and given the lack of supply of quality space in many markets, Savills estimates that prices will continue to rise in prime locations.
Demand for prime logistics warehouses will also be bolstered by increased demand for sustainable property as operators need to integrate them into sustainability-focused supply chains.
