European logistics demand strengthens in Q3 FY25: CBRE

European logistics take-up was 17.4 per cent higher in the third quarter of fiscal 2025 compared with the same period of the previous year. Several markets that experienced a very quiet summer in 2024 saw a rebound this year, according to CBRE.

This increased activity pushed the rolling 12-month aggregate up by 1.4 per cent to more than 21.5 million square metre for the first time in over a year. However, fluctuations have been minimal over this period, reflecting a stabilisation in take-up levels. Previously underperforming markets are now leading the year-on-year recovery.

European logistics take-up rose 17.4 per cent year-on-year in Q3 FY25, lifting rolling 12-month demand above 21.5 million square metre and signalling market stabilisation, led by previously weaker markets.
Net absorption remained positive but subdued, vacancy edged up to 5.5 per cent, and development activity stayed low.
Prime rents grew 3.29 per cent, driven by best-in-class assets.

Annual net absorption remained muted but positive, totalling 11.7 million sq m compared with 15.2 million sq m one year earlier.

The average vacancy rate rose again quarter-on-quarter, but only by 14 basis points to 5.5 per cent. The year-on-year comparison remains challenging, with an increase of more than 100 basis points. However, Spain now records a lower vacancy rate than at the same time last year, making it the first market where the supply response has reversed the upward trend.

Rolling 12-month completions remained stable quarter-on-quarter at 16.7 million square metre, which is 21.3 per cent below the five-year annual average. In addition, space under construction remained subdued, down 17 per cent from Q3 2024.

Annualised weighted prime rental growth increased to 3.29 per cent, driven by best-in-class developments.

Fibre2Fashion News Desk (RR)