TRENDS AND PERSPECTIVES IN THE LOGISTICS PROPERTY MARKET
Christophe Golenvaux
Associate Director Industrial Leasing Belgium 3 March 2016
Contents 1. Overview - Belgium & Europe ▐ Leasing Market ▐ Investment Market
2. Trends reshaping logistics
2
Belgian & European Leasing Market
3
Current European Stock Total European stock above 250 million sq m
7.1
In million sq m > 50 30 - 50
4.3
18.2
20 - 30 10 - 20 22.2
5 - 10
27.0
1-5
20.6
5,000 sq m (UK: >10,000 sq m) Source: JLL 4
Take-up concentrates on European hotspots 2015 annual European take-up sets new record (Germany, France, UK, The Netherlands...)
17.1
million sq m
+14%
YoY
+21%
on 5-year average
2015 annual Belgian take-up performed under average – ranks 9th in Europe
0.483
million sq m
-13%
YoY
-19%
on 5-year average Source: JLL 5
Take-up Belgium 2015 vs. 2014 and 5-yr average Antwerp-Brussels and Antwerp-Limburg-Liège attracted highest volumes in 2015 157,800 191,500 50,550
37,500
Airport
5-y average
Main Sea Ports
Brussels-Antwerp (A12-E19) incl. Nivelles/Meer
2014 2015
Main Inland Ports
Mons-Charleroi-Liège (E42)
Motorway
Antwerp-Limburg-Liège (E313, E34, E314 towards The Netherlands)
Railways
Antwerp-Ghent (E17)
Main Rivers and Canals
Figures in sq.m. 6
Recent Transactions Zaventem
Beringen BRUCARGO
INDUSTRIAL ZONE
MG Real Estate & Montea / DHL
Goodman/Mobis Q2 2015
Q1 2015
58,500 sq.m.
36,500 sq.m.
Port of Ghent
Kontich KLUIZENDOK
SATENROZEN 13
WDP/Distrilog
WDP/DHL
Q4 2015
Q3 2015
20,000 sq.m.
21,100 sq.m.
Willebroek
Heppignies DE HULST MG Real Estate/ Federal Mogul Q3 2015
Trafic Q4 2015 21,000 sq.m.
29,000 sq.m.
7
Belgian & European Investment Market
8
High investment volumes throughout Europe
2015 annual European investment volumes stable on 2014 record year
€ 21.5
-1%
billion
+63%
YoY on 5-year average
2015 annual Belgian investment volumes second highest ever after 2007
€ 0.34
+44%
YoY
billion
+78%
on 5-year average Source: JLL 9
2015 Year-end Logistics & Industrial Investment Volumes Another incredible year for asset class €1,159
Industrial Transaction Volumes 2015 in million €
€943
5,000 or over
€360
1,000 to 3,000
€321
€59
500 to 1,000
€7,420
100 to 500
€1,188
50- 100 0 - 50
€498
€ 3,986
€340
No Transactions
€69 € 2,054
€121 € 416
€84 €23
€ 409 €120
€47
€1,366
3,000 to 5,000
€77 €30
€359
€39
Source: JLL 10
Prime logistics yields, 2015 & Outlook Yield compression continues Stockholm Moscow
5.75% -50 bps
12.00% 0 bps 7.00%
0 bps
Dublin
5.60% -40 bps
Rotterdam
4.50% -25 bps
Birmingham London
4.75% -25 bps
6.50% -50 bps
Hamburg
5.25% -65 bps
Frankfurt
5.80% -95 bps
6.75% -25 bps
Warsaw 6.50% -50 bps
Prague 8.75% -25 bps
6.90% -25 bps 6.75% -50 bps
Berlin
5.25% -75 bps
Brussels Paris
5.40% -75 bps
Budapest
Milan
Madrid Jan 2016 Yield
2015 Movement
Projected Yield Shift
Source: JLL 11
How does Europe compare to US & Asia? Average logistics yield still higher than rates seen in other regions Amsterdam London 5.6%
Berlin
4.5%
Paris 5.8%
Lyon 5.9%
Warsaw
5.4%
Frankfurt
6.75%
5.25%
Milan 6.9%
Bratislava Prague
Barcelona 6.75%
…to the USA? Seattle
China New Jersey Chicago
Denver
4.95%
5.5%
Philadelphia 5.25%
Dallas
5.25% 4.0%
6.0%
Hong Kong
4.75%
Atlanta
4.25%
5.35%
Malaysia 6.5%
Singapore 6.5%
5.5%
4.9%
Miami Source: JLL
…to Asia?
Seoul Tokyo
San Francisco Southern California
6.5%
Average: 5.7%
Average: 5.1%
4.5%
4.25%
Average: 6.3%
8.0%
Australia 6.25%
4.75%
Source: JLL 12
5
Trends Reshaping global logistics
1.
E-commerce
From production -led supply chains to consumer-centric demand
14
2.
Technology
New technology including digitisation of retail, big data, 3D-printing, robotics etc. will drive change
3.
Globalisation and right-shoring Globalisation will continue but European logistics markets are likely to see more re-shoring and near-shoring
16
4.
City logistics
Demand for last mile logistics facilities is expanding due to the growth of online retail
17
5.
Multi-modality Traffic congestion, the segmentation of supply chains and sustainability issues create opportunities for futureproof multi-modal warehouses
18
Real estate implications New trends will drive change in the type and location of logistics facilities
Logistics buildings will get taller
Multi-modal logistics platforms in cities
Warehouses must have secure and ubiquitous wireless access
Declining space for staff amenities and car parks
Consolidation centres in cities and at the city fringe
Rising demand for facilities supporting faster throughput but declining demand for storage space
Declining dependence on locations with strong workforce
Multi-storey ramped logistics facilities
Conclusion ü Technological change will have a higher impact on supply chain processes and logistics real estate. ü The challenge of city logistics will drive demand for a range of facilities in and around major European cities. ü
Globalisation will continue, but European logistics markets are likely to see more re-shoring and near-shoring.
20
The changes to supply chains will impact property, but the future for the right logistics property is bright.
21
Thank you for your attention. Contacts:
Christophe Golenvaux
Associate Director Industrial Leasing Belgium Tel. +32 2 550 25 18
[email protected]
Ann Vanderwegen
Senior Research Analyst Tel. +32 2 550 26 81
[email protected]
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