Making logistics projects economically, ecologically and socially responsible will ensure success, says Ingo Steves.

Choosing a location for logistics purposes is about more than just proximity to urban centres. Several factors influence both the operational efficiency and the environmental compatibility of a logistics company. A strategically favourable location that offers optimal connections to logistics routes is not only crucial for the efficiency of supply chains, it also has a positive impact on the company’s carbon footprint. In times of skilled labour shortages, the attractiveness of the region for potential employees is also becoming increasingly important.

However, users and logistics property developers are faced with the problem that ideal spaces in attractive locations are not really available. This raises an important question: how can developers respond strategically to the lack of space in urban centres – and thus offer alternatives to increasingly rare greenfield developments?

Germany’s central role in the European logistics landscape

One of Germany’s key competitive advantages is its location in the heart of Europe.

This geographical feature has long made the country a hub for the international movement of goods. Its decentralised economic structure also satisfies multi-layered demand within the logistics sector, as it offers everything from large-scale warehousing and distribution centres – the big boxes – to small-scale logistics units.

These advantages also extend over a large area within Germany. The most important logistics regions include Hamburg and the surrounding area, the Ruhr region and the Rhine-Main area. With their highly developed infrastructure and important logistics hubs such as Frankfurt Airport and the Port of Duisburg, these regions offer significant advantages in terms of location for companies from a wide range of sectors.

However, the availability of land in these regions, which are considered particularly attractive for logistics projects, varies greatly. In some up-and-coming logistics regions, such as Saxony, greenfield developments like Zwickau North, our latest project that has just been completed, are still possible.

Limited new space for development

However, in already densely populated and developed regions such as the Ruhr area or Munich, there is hardly any space left for such new developments. Here, new space for logistics projects has to be created almost exclusively through the conversion of existing sites. This scarcity poses a major challenge that requires innovative solutions and strategic planning to meet the growing demands of the logistics sector.

‘By emphasising ecological aspects, the public and municipal decision-makers will perceive logistics companies and projects positively.’

Ingo Steves, Swiss Life Asset Managers

One example of such a conversion is our Düsseldorf East logistics project in Wülfrath, located in the middle of the Ruhr region between Düsseldorf and Wuppertal with direct access to the A535, A46, A44 and A3 motorways. To counteract the shortage of space, the project was realised on a brownfield site. Although the investment costs for this type of regeneration are generally higher than new construction on a greenfield site, the properties benefit from an optimal location in already-developed commercial areas.

Aesthetics and added value for the community

One way to increase the acceptance of logistics real estate is to optimise the design and layout of logistics centres.

An attractive design has added value for residents as well as the municipality, by making it easier to integrate the property into the urban environment. By integrating facade and roof greening, attractive colour accents and architectural features, logistics centres can become a positive part of the cityscape. Such measures not only improve the external appearance of buildings, but can also contribute to the quality of life of residents, by creating public green spaces or recreational areas, for example.

Sustainability measures as a key factor

Another decisive factor in convincing local authorities to attract logistics companies is the focus on sustainability. The use of renewable energy or sustainable construction methods can improve the environmental footprint of logistics centres and contribute to cost efficiency in the long term. Investing in charging stations for electric vehicles can also be worthwhile, as noise and polluting emissions are reduced.

That’s why we at Swiss Life Asset Managers focus on ESG measures and design our properties to be sustainable in the long term. Our logistics centre north of Zwickau has a comprehensive energy concept: a photovoltaic system and modern heat pumps ensure independence from fossil fuels.

By emphasising ecological aspects, the public and municipal decision-makers will perceive logistics companies and projects positively. By demonstrating that logistics centres are not only economically viable, but can also be aesthetically pleasing and environmentally friendly, reservations about new developments can be overcome.

Strategic planning for a sustainable future

While a shortage of space in strategically favourable locations is a challenge, it also presents an opportunity to change the real estate industry sustainably and make it future-proof. Making logistics projects economically as well as ecologically and socially responsible will be a decisive factor for the long-term success and acceptance of the industry.

Developers prepared to innovate and place sustainability at the centre of their projects will have a decisive influence on the real estate landscape of the future.

Ingo Steves is managing partner for logistics at Swiss Life Asset Managers