Industrial property specialist Prologis is forecasting rents at its European operations will grow 20% by 2016.
Industrial property specialist Prologis is forecasting rents at its European operations will grow 20% by 2016.
The prediction follows a record amount of new leasing worldwide and a 1.4% rental increase on new leases and renewals in Europe in the final quarter of 2013, driven by strong performances in the UK, Czech Republic and Sweden, the company said.
Full-year leasing activity in Europe increased ‘significantly’ to 2.96 mln m2 in 2013. The Amsterdam-based company also launched a number of new developments totalling 409,700 m2, including four speculative projects.
Earlier this week, Prologis announced it has signed two build-to-suit agreements totalling 45,800 m2 in the UK. The agreements include a logistics facility at Prologis Park Littlebrook in Dartford and another at Prologis Park Ryton in the West Midlands.
Overall, core funds from the company’s global operations (Core FFO) fell to $1.65 (€1.20) in 2013 from $1.74 the previous year, despite a marginal increase in Q4. However, net earnings per fully diluted share swung back into the black to $0.64 over the full year after a net loss of $0.18 in 2012. Net profit soared over the full year to $315.4 mln from a loss of $80.9 mln the previous year on revenue down 10% at €1.7 bn. The year-on-year increase was primarily due to gains on the disposal of assets.
In Europe, Prologis disposed of 123 acres of non-core land in the UK, France and Poland in the final quarter.
Commenting on the group results, chairman and CEO Hamid R. Moghadam attributed the improvement to ‘the strong market fundamentals’ that continued throughout 2013. ‘We significantly increased occupancy with solid rent growth, exceeded our value creation objectives with above-average development margins, and substantially grew our investment management business.’
During the fourth quarter, Prologis raised $1.8 bn in third-party equity, leading to a record $4.1 bn over the full year. In Europe, Prologis' open-ended funds raised nearly €1 bn of capital in 2013, the company said. Total assets owned and under management rose almost 8% year-on-year to $48.2 bn.
