15 February 2018 – Expansión
Real estate investment in logistics assets exceeded €1.5 billion in 2017, up by 86% compared to the previous year. That figure includes the corporate operation involving Logicor.
The boom in e-commerce, combined with their attractive returns, have placed logistics assets in the spotlight for real estate investors. In this way, last year, the purchase of these types of properties reached a record-breaking €1.5 billion, according to the consultancy firm Savills Aguirre Newman.
That disbursement represents an increase of 86% compared to the previous year and is the highest figure ever recorded for these types of properties in the Spanish market. Nevertheless, the amount does include the corporate operation carried out by Blackstone. The US fund divested its logistics subsidiary, owner of 147 million m2 of space across 17 countries (including in Spain) to China Investment for €12.25 billion.
In the last three months of the year alone, investment in these types of assets exceeded €200 million.
Unlike other types of properties, such as offices, interest in these assets extends beyond Madrid and Barcelona. “The consolidation of economic growth and the gradual improvement in the fundamentals of the logistics market (demand, availability and rental prices) has continued to drive investment in the sector, which, due to the shortage of supply in Madrid and Barcelona, has shifted its interest to secondary markets, such as Zaragoza and Valencia”, say sources at the consultancy firm.
The large operations of the year included P3’s purchase of GreenOak’s portfolio for €243 million.
In fact, the high degree of interest has caused many investors to back the purchase of plots of logistics land for their subsequent development. “Operations involving logistics land, for the development of turnkey and at-risk projects, have become one of the cornerstones of the market. The high demand for space, combined with the shortage of finished products suitable for the requirements of specific demand, is generating a lot of interest in this product”, explain sources at Savills Aguirre Newman.
The boom in operations has already had an impact on the returns offered by these types of properties. “The initial rate of return for the most prime assets was below 6%, but during the course of the year, for some specific operations, the rate amounted to 5.5%, which means that the gentle upwards trend already observed in previous years is being maintained”.
Original story: Expansión (by Rocío Ruiz)
Translation: Carmel Drake