Covid-19 and Brexit driving growing occupier demand for European logistics space
A new survey from global real estate advisor, CBRE shows that Covid-19 remains an important consideration for occupiers and will continue to drive demand for space in Europe. CBRE’s first European Logistics Occupier Survey, in conjunction with Analytiqa, analysed responses from more than 100 of the largest European logistics occupiers with a combined footprint of more than 40 million square metres across manufacturing, online and general retail, supermarkets and third-party logistics.
The survey shows that 47% of respondents highlighted a long term need for flexible storage space, with 36% of occupiers looking to accelerate their plans to ensure logistics facilities are ready to cope with increased demand from the rapid growth of the online channel.
Respondents also showed a willingness to explore non-traditional locations, outside of the core logistics hubs, to accommodate their expansion. A total of 64% of online retailers admitted that they would consider non-traditional locations, with 44% of all respondents saying they would do so.
The survey also shows that urban logistics is becoming increasingly important, with 64% of online retailers suggesting expanding in urban locations is now a high priority. This trend is reflected in the fact that delivery time to customers remains one of the most important factors influencing location decisions, with urban locations increasing efficiencies and shortening supply chains.
Moreover, according to the survey, 50% of online retailers in Europe believe they will need additional logistics space in the UK as a consequence of Brexit, with a further 40% suggesting they will also need additional space in the EU.
Recent global events have shone the spotlight on logistics and alerted people to the importance of global supply chains. These trends have accelerated demand from logistics occupiers and placed greater importance on issues such as labour cost and availability, urban logistics, lease costs and flexibility. These trends in turn impact investor decision making and we anticipate high investor demand, especially in emerging logistics hubs, over the coming year, as a result of these strong occupier fundamentals.