Investing in logistics real estate

PERE’s 2024 Logistics reports explores the sector’s challenges after a pandemic-era building frenzy, and how its resilience may pave the way for a rebound.

Once buoyed by strong demand amid rising e-commerce trends and the effects of the pandemic, some believe the sun has set on logistics’ golden era. Aging supply and a skilled labor shortage are challenges, while near-shoring and re-shoring are changing the face of the sector. The sector’s ravenous construction pace has slowed. However, many industry participants believe the sector’s resilience – especially in certain sub-sectors like cold storage and truckyards – and strong demand drivers mean the sector could be ready for a new dawn.

Three ways logistics real estate is ripe for a rebound

PERE's 2024 Logistics report shows strong potential in the sector for investors that can navigate its challenges, including labor shortages and supply chain issues.

Solid indicators belie volatility in the logistics sector

Logistic real estate has come sharply off its post-pandemic peak, but the underlying drivers remain firm and upheaval may open up opportunities.



Are investors losing their taste for logistics, long seen as one of real estate’s most tempting sectors? The wider effects of Russia’s invasion of Ukraine have hit the market especially hard, with many managers nervously hoping rental growth stays on the right side of interest rates. Yet the ingredients for success remain: strong demand, growing sectors such as cold storage and dark kitchens and varying types of distribution including mega-centers and last-mile logistics – investors may well pick up the menu afresh in H2.

Supply-chain reconfiguration and increased e-commerce needs are increasing demand for logistics facilities, from warehouses to distribution facilities and fulfillment centers. As occupiers and investors cannot get enough space, competition is fierce for the right assets, especially last-mile facilities that could yield substantial savings in transportation costs, as well as reductions in carbon emissions as the industry grapples with its responsibility to fight climate change.

2020 was a banner year for industrial real estate. The asset class had been growing for years – rising alongside e-commerce – but that growth went into overdrive as covid-19 shook the markets up. Industrial investment accounted for a fifth of all real estate volumes over H1 2020: the asset class has been growing for years; now its time has well and truly arrived.

PERE’s annual deep dive into global logistics real estate reveals an asset class in the midst of an exciting evolution. And more and more institutional investors want to get in on the opportunities the sector is offering up. This issue is packed-full of insight on the trends shaping logistics, and the very latest data on fundraising and deal volumes.

Packed-full of performance data and thought leadership from leading investors, developers and managers, the 2019 PERE Investing in Logistics & Distribution report takes a detailed look at current global trends shaping this growing property sector.

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