Logistics Real Estate Market DE 2022 – Slight Decline in New Construction Volume

The logistics real estate market concluded the year 2022 with a slight decline in new construction volume. According to the evaluation of its own research data as part of the annual logistics real estate seismograph, the consulting company Logivest reports a total of around 5.1 million square meters of logistics new construction area starting in 2022 – about 400,000 square meters less than in 2021.

(Munich) By mid-year, it became clear that the Russian war of aggression against Ukraine and the resulting inflation would also leave their mark on the logistics real estate market. “Especially in saturated markets, economic uncertainties became apparent from the third quarter of 2022. Those who could afford to do so postponed their projects directly to 2023. Given the situation with massively increased construction costs, a very dynamic interest rate development, and low sales factors, I still believe we can speak of a stable market,” said Kuno Neumeier, CEO of the Logivest Group.

Established Markets Take the Top Ranks

Duisburg/Niederrhein, Leipzig/Halle, and Berlin/Brandenburg – the top 3 placements from 2022 hold no major surprises. Duisburg/Niederrhein leads by a wide margin with approximately 535,000 square meters, making it the most dynamic logistics region in Germany, followed by Leipzig/Halle. The top region from 2020, after a slight decline in 2021, now occupies second place with around 300,000 square meters. Just behind, with about 295,000 square meters, is the capital region Berlin/Brandenburg.

While these markets benefit from project starts in the first and second quarters, the Rhine-Main region is perhaps the most striking example of the previously mentioned project delays. In 2021, with around 380,000 square meters in first place, the region recorded only about 95,000 square meters in 2022, thus ranking 17th out of 24 logistics regions for the first time.

Dresden/Chemnitz and Koblenz Among the Top 10

On the other hand, the Koblenz region provides a positive surprise. Having consistently ranked in the lower third in recent years, the region catapults itself to ninth place in 2022. Key projects include the approximately 60,000 square meter logistics property in Polch, southwest of Koblenz, which is fully leased and developed by Lang & Cie, as well as a logistics center of around 55,000 square meters that Dietz AG is constructing for Wacker Neuson northwest of Koblenz in Mühlheim-Kärlich.

The Dresden/Chemnitz region, awarded as the 24th top logistics region by the Fraunhofer Institute just last year, is also among the winners of the year. With around 225,000 square meters of new construction area, the region in the east of the republic ranks sixth and impresses with large-scale developments such as the approximately 72,000 square meter logistics center in Mittelsachsen, which the project developer Fuchs Immobilien is building on behalf of Invesco Ltd. in Hainichen, or the new logistics property of around 28,000 square meters that VW will occupy in Meerane.

Sustainability Defies Inflation

Another positive development can be observed in terms of sustainability. The question is no longer whether energy-efficient construction will take place, but to what extent. The largest project developments of the year also exhibit a high degree of sustainability. The largest project development of 2022, comprising two halls and covering around 94,000 square meters, will be built according to ESG standards on a brownfield site in Dettelbach in the logistics region of Würzburg/Schweinfurt. The project developer Panattoni is developing the logistics park for clients S.Oliver and Dachser. In the Rhein-Lippe port in Wesel, BEOS Logistics is constructing a logistics center of approximately 85,000 square meters for the logistics service provider Rhenus, which aims to set new standards in energy supply for logistics properties. The goal is to make the property completely independent of fossil energy sources using geothermal energy, photovoltaic systems, and heat pumps. Additionally, the third largest development of last year, a logistics park in Bitterfeld-Wolfen by Garbe Industrial Real Estate, is also expected to meet the highest energy requirements, with construction following the KfW40 standard. A photovoltaic system will be installed on the roof to generate renewable energy.

“For several years now, the topic of sustainability has been gaining increasing importance in the logistics real estate market,” said Neumeier. In 2022, however, a real competition in terms of energy efficiency was observed, according to the logistics real estate expert. “Of course, the rising energy prices give the topic a new urgency. However, it is also noticeable that sustainability has become an important quality criterion.” For Neumeier, the challenge in 2023 lies primarily in continuing this momentum under the current conditions. “To remain financially viable, sustainability must also be considered from an economic perspective.” The entire survey on the new construction volume for 2022 will be summarized in the logistics real estate seismograph by Logivest and will be available for free download starting next week: https://www.logivest.de/infocenter/seismograph

Photo: © Logivest GmbH