The German market for logistics real estate is holding its own in a market environment shaped by economic and geopolitical challenges. Conditions are testing market participants on multiple levels, yet the segment is demonstrating considerable resilience in the face of the general economic downturn.
Financing conditions dampen investment volume
On the investment side, the altered interest rate environment is prompting caution. Interest rate movements have made financing noticeably more expensive and have led to a distinct slowdown in transactions. Investors are currently reviewing commitments with heightened caution, as the changed terms have a direct impact on yield expectations and pricing structures.
Against this backdrop, portfolio holders and potential buyers are adopting a wait-and-see approach. Although interest in logistics as an asset class remains fundamentally high, the current interest rate level is putting the brakes on many planned acquisitions and delaying decision-making processes across transactions.
New occupier groups strengthen demand for space
In contrast to the subdued investment market, the occupier side is experiencing fresh demand impulses. The profile of prospective tenants is changing visibly. Chinese e-commerce companies in particular are expanding their activities and capacities in the German market and increasingly emerging as occupiers of space.
This expansion by Asian online retailers is supporting occupancy and ensuring the continuous absorption of available logistics space. The expanding providers are specifically seeking suitable properties to develop their logistics networks in Central Europe and make supply chains more resilient.
- —Market holds its ground amid challenging macroeconomic and geopolitical conditions
- —Noticeable slowdown in investment activity as a result of rising interest rates
- —New demand potential driven by expanding Chinese e-commerce players
The market currently exhibits a clear division: on the one hand, willingness to invest remains at a defensive level due to financing costs, while on the other, new occupier structures in e-commerce are providing a stable foundation for the further development of space demand.
