36
GERMANY
ISSUE
I
LOGISTICS PROPERTIES
characterised by a high purchasing pow-
er. As a transit country in the European
heartland, it plays a major supply role for
other parts of Europe, too. The logistics
sector, like many other business areas, is
showing signs of a certain consolidation.
In concrete terms, the 20 largest demand-
ers accounted for at least 30 percent of
the entire take-up during the past five
years. These companies represent the
areas of logistics (including CEP service
providers), e-commerce and automotive
logistics in the manufacturing industry.
Another powerful demand driver is retail
logistics. In addition to corporates and
conglomerates with very large demand,
there is also a fragmented sector of small-
scale demand.
GERMANY‘S TOP-10 USER GROUPS,
2011-2016
1. Deutsche Post DHL Group
(freight/transportation): 3.83 %
2. Amazon (e-commerce): 3.02 %
3. Schwarz Group
(retail logistics): 2.21 %
4. Volkswagen Group (manufacturing
industry/automotive): 1.96 %
5. BMW (manufacturing industry/
automotive): 1.85 %
6. DB Schenker Logistics
(freight/transportation): 1.75 %
7. Kühne + Nagel
(freight/transportation): 1.59 %
8. Fiege Logistik Group
(freight/transportation): 1.45 %
9. Rudolph Logistik Group
(freight/transportation): 1.43 %
10. Metro Group (retail logistics): 1.40 %
The number of companies developing or
acquiring logistics property for owner oc-
cupancy is steadily declining. As a result,
logistics space take-up is clearly driven
by lettings: Between 70 and 90 percent
of the space that changed hands over the
past five years was rented by the incoming
occupiers. Demand for logistics facilities
varies among Germany‘s regions. Major
auto manufacturers for instance tend
to use large areas in the vicinity of their
plants. By contrast, spare parts warehouses
are sometimes located well away from the
F
or many investors, Germany‘s market
for logistics real estate appears to be
more attractive than ever. In 2016, the
segment generated an investment turno-
ver of nearly 2.3 billion euros with large-
scale logistics real estate. Another 361
million euros were invested in industrial
properties, and well over 1.8 billion euros
in multi-use, multi-let commercial real
estate (“Unternehmensimmobilien”).This
brings the turnover in the commercial real
estate segment up to a total of nearly 4.5
billion euros in 2016.The investment mar-
ket‘s five-year average (2011-2015) was
topped by close to 22 percent in 2016, but
fell short of the record level of 5.6 billion
euros achieved in 2015. That being said,
the interest in this asset class has noticea-
bly increased, which is clearly demonstrat-
ed by the strong yield compression.
With its survey “Logistics and Real
Estate 2016,” bulwiengesa resumed an in-
vestigative series on German logistics real
estate as an asset class it had launched in
2015. Partners of the syndicated survey,
whose next issue will be published in the
fall of 2017, are Berlin Hyp, BREMER,
Goodman and Savills.
What makes this market so attractive?
At around five percent, yields for new-
build logistics real estate are comparative-
ly high in Munich, Hamburg and Berlin.
Moreover, they are less susceptible to cycli-
cal fluctuations than office or retail prop-
erties. It is this aspect that attracts foreign
investors, who have stepped up their com-
Opportunities in
the European Heartland
Germany is home to a large number of logistics sites. In
recent years, many international investors chose to enter into
logistics real estate commitments in Germany. But where
does it pay to invest? What are the demand drivers? A survey
by the bulwiengesa research institute has the answers.
mitments in the German logistics property
market in recent years, more than others.
Indeed, the market share of foreign inves-
tors, which equalled 47 percent in 2011,
was already up to 69 percent by 2015. Al-
though the foreign share suffered a light
setback in 2016, it was explained by the
absence of portfolios on the market. Port-
folios are much more interesting to inter-
national investors than to German ones,
who prefer single-property deals.
WHAT ARE THE DEMAND DRIVERS?
The de-
mand for logistics facilities is high. At the
moment, nothing suggests that this will
change anytime soon. Another indication
for keen demand is the increasing number
of newly-built logistics facilities. After all,
mega trends in the areas of consumption
and production, such as e-commerce and
Industry 4.0, impact the distribution busi-
ness. One example is the increase in on-
line sales. Future growth will increase the
demand for logistics space, especially in
the areas of B2B and fresh food logistics,
which have so far played but a negligible
role in Germany.
The fortes of Germany‘s national
economy interact closely with those of
the logistics sector. For one thing, the
rather high share of the manufacturing
industry – compared to other countries
– in combination with a high export rate
creates a strong demand for logistics
facilities. On the other hand, Germany
itself has a large consumer constituency
