Industrial real estate is just as popular as yacht parties, per research revealed at this week’s MIPIM conference.
The studies unveiled at the annual property affair in Cannes by brokers CBRE and Savills reflected investors’ changing preferences, with logistics this year emerging as the top draw, riding the tailwinds of the e-commerce boom.
Indeed, the asset class even overtook traditional favored type offices for the first time, according to CBRE’s annual EMEA Investor Intentions Survey released Wednesday. CBRE noted in the last year, large investors gained access to the property type through platform-level deals, such as China Investment Corporation’s €12.2 billion purchase of the Logicor Portfolio from Blackstone and GLP’s $2.8 billion purchase of IDI Gazeley. “Not only did the purchasers, typically large Asian investors, access the market at scale, but by buying an operating platform they also acquired the infrastructure and management expertise to manage the assets and continue to develop the portfolio,” the report said.
Meanwhile, Savills noted differences among European logistics markets in a MIPIM report. The firm’s Netherlands-based team said Dutch logistics is poised for major growth because of rising occupier demand, which is higher than in established markets such as the UK and Germany. Take-up in the market last year was 49 percent higher than in 2016, with rents remaining stable as new product comes online.
Cross-border investment into the Dutch market represented the majority of industrial deals last year, Savills said.
“With the German and Dutch logistics markets being comparable, in terms of infrastructure, ports, etc., we foresee prime yields to tighten to the level of current German yields,” Douglas van Oers, Savills’ Dutch head of logistics, said in the report.