Logistics yields will fall but growth could dip in 2022

Yield compression of around 40 basis points can be expected in the logistics asset class this year according to Rene Buck, CEO of BCI Global.

“It’s crowded and a lot of companies are looking for logistics real estate assets meaning that all over Europe there is yield compression.”

The attraction is the rapid growth in occupier demand for logistics space increased by about 10% last year owing to the increase in e-commerce as well as companies building inventory to ensure supply chain resilience.

BCI has recently published a report, The Future of the Logistics Real Estate Markets in Europe and Buck believes that although there is considerable local variation, growth will slow a little in the aftermath of the covid years 2020 and 2021.

The sector has “a sunny future” but there will be a battle to find the right assets for investors and developers will have issues finding sites.

Click on the video to watch the full interview or listen to the podcast below.