Lufthansa Cargo with a Different Year in Review 2024
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The recession will also be reflected in the German logistics real estate market in 2024. The rental market has significantly declined, buffer warehouses are being reduced, and logistics service providers are increasingly reporting vacant spaces. However, there are also positive signals. The holistic logistics real estate advisor Logivest reports a slight increase in new developments compared to 2023.
(Munich) “As of now, we have over 4 million square meters of logistics new developments in 2024,” confirms Kuno Neumeier, CEO of Logivest. At the same time, rental prices are normalizing and are settling back to a lower level due to decreasing construction costs. According to Neumeier, there will also be projects under six euros per square meter in 2024.
Unlike in the previous year 2023, speculative constructions are also on the rise again. “One of the largest project developments in 2024, the Log Plaza in Frankfurt Oder, is currently being developed by Alcaro without pre-letting. A positive sign that shows how much trust project developers have regained in the stability of the German logistics real estate market,” says Neumeier. It is also noticeable that the new construction projects continue to have a strong focus on sustainability.
Despite all the optimism, the Logivest CEO also sees challenges. “Especially in existing properties, we have some vacancies, and 2024 has been a difficult year for logistics service providers. Even in the peak season – from Black Friday to Christmas – the market for managed warehouse spaces recorded many vacant areas. Based on the figures from our logistics service provider exchange Logivisor.com, we currently estimate a gray market of at least 2 million square meters.”
The developments in the volatile automotive sector will also challenge the logistics real estate market in the long term. Although the logistics center of Mercedes Benz in Bischweier, with a usable area of around 100,000 square meters, is still the largest new construction project of the year in 2024, competition in the electric vehicle sector, especially from China, is on the rise. It remains to be seen how the production decline of German car manufacturers will affect the space requirements of the supplier industry.
The logistics real estate market is likely to stabilize further in 2025
Despite all adversities, “the logistics real estate market is likely to stabilize further in 2025. New space demanders, such as the growing defense sector, will also play a role,” summarizes Neumeier. Detailed data on new developments in 2024, including an outlook for 2025, is expected to be published in mid-January in the Logivest Logistics Real Estate Seismograph 2024/2025.
Photo: © Loginfo24
