Flight to quality defines logistics investment

Investors are increasingly focusing on resilient, energy-efficient and ESG-compliant logistics assets as market uncertainty drives a clear flight to quality, according to Maximilian von Medem, investment management logistics DACH at Union Investment Real Estate GmbH.

Speaking to Real Asset Media at EXPO Real 2025, von Medem said: “Due to current uncertainties in the market, geopolitical disruptions and tariff risks, we see a flight to security, to resilience and to flexibilities. We see a flight to quality. They need assets that are ESG-compliant; they need energy-efficient assets.”

He added that the leasing market has stabilised, with speculative development declining — a trend that is improving the value of standing assets with secured leases.

“Certainly, there is a spread between prime and secondary assets right now,” he said.

Von Medem noted that core capital is returning to the sector but remains highly selective.

“They are very, very focused on energy capacity, data capacity and ESG compliance,” he said. “We hear quite a bit about reduced focus on sustainability, but we don’t really see it in the market at all. Our tenants and our investors have a very strong focus on it.”

The pricing gap between sustainable and non-sustainable assets is widening, he added, though demand for traditional certification schemes is falling.

“There is a big spread in pricing between sustainable assets and non-sustainable assets,” von Medem explained. “On the other hand, where we see a decrease in demand is for the classic labels. We don’t look at the labels so much as we look at the CRREM [Carbon Risk Real Estate Monitor] path. We look at the EU taxonomy, but not so much on the labels.”