- European industrial real estate values declined 21.9 percent from the pre-crisis peak in 2007, and have subsequently only recovered by 1.3 percent on average. Current values are attractive relative to replacement costs and the pattern of value recovery in the U.S. following the global financial crisis.
- Logistics real estate delivered 7.6 percent in direct return over the last 10 years, some 200 and 240 basis points higher than the direct return component of office and retail respectively.
- Despite weak GDP growth in the EU—just 1.5 percent per annum over the last 10 years—trade and supply reconfiguration are expected to drive strong demand for distribution space in Europe.
- The U.S. market has more than four times the Class-A distribution stock relative to Europe, where Class-A logistics assets account for only 14 percent of industrial stock. The European logistics property market is therefore relatively underdeveloped.
- E-commerce is increasing, requiring retailers to re-evaluate their distribution channels to support demand and expected growth. Every additional €1 billion of online sales resulted in an average additional warehouse demand of approximately 72,000 square meters in the UK, Germany and France over the last five years.
Prologis Research Examines European Industrial Property Market Investment Opportunities
Check Out Our Best Services for Investors
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Model portfolio
- Stocks trading below $10
- Intraday trade alerts
More than 30 investing pros with skin in the game give you actionable insight and investment ideas.