Strong demand for bulk storage and rising prime rents in the Logistics sector

The logistics property market too has been suffering the consequences of the economic crisis, especially in the form of drastically declining investment volumes. Nevertheless, some sectors continue to succeed. The food and spare-part distribution sectors in particular are holding out, while stronger demand for bulk storage has been observed, especially in the ports of Rotterdam and Amsterdam. Inland it is mainly the cities of Breda and Almere that have managed to better present themselves as logistics junctions.

The above was stated in property advisor CBRE’s recently published Market View dedicated to the logistics property market in the Netherlands

The report also says that logistics property prime rents are surprisingly on the increase, despite declining users’ demand. The strongly increased yields are prompting developers to push up rents for their projects to secure acceptable margins. This mechanism leads to rising logistics prime rents, which in the Netherlands had remained stable for years. In 2008 logistics property’s initial yields increased strongly and today are a comfortable percentage point higher compared to the previous year. CB Richard Ellis expects price decline to reach limit soon and specialist funds to hesitantly join market again this year.

Click on the link below to view the full report

Dutch Logistics Market View