As expected, the German market for logistics and warehouse premises was unable to quite match the record result of the year before but it nevertheless turned in another extremely good performance, breaking through the 5 million square metre threshold for the second time in a row. Nationwide, take-up in 2012 totalled around 5.09 million m², which was just 13 % lower than the exceptional prior-year figure but still the second best turnover ever registered. This is revealed by the Logistics Market Report 2013, due to be published in mid-March by BNP Paribas Real Estate (BNPPRE).
“The fact that take-up bettered the ten-year average by all of 41 % is another indication of the great buoyancy of the markets in 2012. The decline in space turnover affected almost all regions, with the main population centres and the other logistics clusters all posting lower figures. Only the Ruhr region was able to buck the trend by generating a total of 337,000 m² to achieve year-on-year growth of 15 %”, reveals Hans-Jürgen Hoffmann, Head of Industrial Investment & Services at BNP Paribas Real Estate.
Another gratifying fact is that demand was spread relatively uniformly across the different size classes. The biggest contribution to aggregate turnover was made by leases for premises of up to 8,000 m², which accounted for just over 25 % of the total. Two classes each achieved shares of close to 22 %: large deals upwards of 35,000 m² and mid-range lettings of between 12,000 m² and 20,000 m². But the second-largest size category, 20,000-35,000 m², also generated almost 19 % of all turnover. So in general, there was stable demand in all market segments, with only the number of mega-deals ending lower than in 2011.
Logistics firms take first place – Prime rents unchanged
Where the distribution of take-up between the various business sectors is concerned, there were no marked year-on-year changes. With a share of slightly under 39 %, logistics firms again finished well out in front. In second place, just like the year before, came wholesale/retail companies, with just over 30 %. However, that was slightly down on their prior-year contribution of 37 %, because of the lack of the strikingly large leases that had been concluded in 2011. All the same, online traders in particular continue to represent one of the most important sources of demand. Manufacturing companies stepped up their contribution to the total appreciably by generating around one quarter of all turnover.
Take-up of logistics and warehouse space in the main German population centres (Berlin, Cologne, Düsseldorf, Frankfurt, Hamburg, Leipzig, Munich) totalled around 2.2 million m². That was around 22 % less than in 2011 but on a par with the result posted in 2010 and more than 11 % higher than the long-term average. In terms of performance, the list of locations was headed by Hamburg with 565,000 m² (-24 %) in front of Frankfurt with 432,000 m² (-13 %). Totals that compare well with the multi-year average were also achieved by Berlin with 340,000 m² (-22 %), Munich with 312,000 m² (-6 %) and Düsseldorf with 234,000 m² (-16 %). Leipzig also performed well, even though its result, 219,000 m², was 32 % lower than in the record year of 2011. Only Cologne registered a steeper decline, of 50 %, to give it turnover of 118,000 m², thus posting a weak year. Outside these key locations, take-up totalled 2.9 million m², representing a year-on-year fall of just over 4 % – in other words, the downturn in the rest of the country was far less sharp than in the big cities. The Ruhr region was the only market able to increase its turnover compared with 2011, with a total of 337,000 m² (+15 %).
Whereas in 2011, top rents had risen almost everywhere, in 2012 they largely remained stable. With a prime rent of 6.20 €/m² for absolutely premium premises, Munich and Frankfurt once again head the ranking by a clear margin. Then come Hamburg (5.60 €/m²), Düsseldorf (5.10 €/m²), Cologne (4.80 €/m²) and Berlin (4.70 €/m²). At the bottom of the list of important logistics clusters, with rents of 4.25 €/m² and 4.20 €/m² respectively, come Greater Leipzig and the Ruhr region, but to a certain extent this very fact can be regarded as a locational advantage.
Outlook
“Even though current forecasts for the German economy in 2013 suggest that growth is likely to be somewhat reticent, there is a good chance that take-up in the logistics and warehouse premises market will once again be very strong. One reason for this assessment is that many indicators point to economic output picking up again from as early as the middle of the year”, says Hans-Jürgen Hoffmann. Another factor is that several overriding trends in this market are set to continue and should contribute to buoyant demand. These include in particular the increasing significance of online trading and also outsourcing by industrial companies, something from which contract logistics firms especially benefit. So there is at least a possibility that the 5 million square metre mark could be exceeded once again. After a year of stabilisation, rents appear to offer scope for a modest rise, but it remains to be seen whether this can in fact be realised.