12th Annual CEE Investment Awards
The 12th EuropaProperty.com CEE Investment Awards, celebrating excellence in the commercial real estate sector, were held on October 27th. We sponsored the award in the Investment Deal €50-€100 million category, which was presented to Macquarie Asset Management for acquisition of Żabka Polska BTS in Radzymin.
Congratulations to all the winners!
To Keep Up With E-commerce
According to very interesting report by Knight Frank "Europe’s last mile" 🇪🇺 Europe needs additional 3.5 million sqm of last-mile warehouse space in order to keep pace with the e-commerce growth. Please find my summary and key highlights of this report:
✅ 48% is the forecasted increase of online retail sales over the next 5 years across the top seven e-commerce markets of mainland Europe (🇫🇷 France, 🇩🇪 Germany, 🇮🇹 Italy, 🇪🇸 Spain, 🇳🇱 Netherlands, 🇸🇪 Sweden and 🇵🇱 Poland).
✅ Last-mile accounts for 20-25% of online distribution space.
✅ Each €1 billion in e-commerce sales requires 24,000 sqm of urban logistics space.
✅ 15.6% is the current online penetration rate in the top 7 e-commerce markets of mainland Europe. It is expected to reach 19.3% by 2026.
✅ €293 billion online retail sales totalled in 2021 and is expected to increase by €142 billion and reach €434 billion in 2026.
✅ 3.5 million sqm is required by 2026 in additional last-mile space ( 🇩🇪 Germany - 1.37million sqm, 🇫🇷 France - 639,000 sqm, 🇵🇱 Poland - 536,000 sqm and 🇪🇸 Spain - 378,000 sqm).
✅ 🇵🇱 Poland and 🇪🇸 Spain are expected to be the fastest growing economies over the next five years, this is leading to higher levels of consumer spending and retail sales growth.
Source: Knight Frank
Warehouses in numbers: 2022 vs 2010
In 2021 nearly $172 billion was spent on warehouse acquisitions, according to Savills and it more than a fourfold increase from a decade ago.
At the same time, as CBRE reports, average US warehouse rents have risen ~75% since the beginning of 2010 to $8.18 a square foot from $4.72 a square foot.
As a result of the boom, warehouse ownership has shifted from a small owners (businesses and manufacturing companies) to blue-chip money managers and private equity funds such Blackstone, KKR & Co. Inc., Prudential Financial, Brookfield Asset Management, Ontario Municipal Employees Retirement System. All of those companies spotted the rising demand for the properties.
Over each of the past 12 years, institutional investors have purchased more warehouse space than they've sold, while private owners and owner-operators have sold more than they've purchased.
Source: Business Insider
"Investment Deal 50-100 million"
It is our pleasure to sponsor the award for the "Investment Deal 50-100 million" during next weeks 12th annual EuropaProperty.com CEE Investment & Manufacturing Awards.
The nominees in this category are:
Adventum Group for the acquisition of Sky Tower in Wroclaw,
Big Shopping Centers Ltd. for the acquisition of two shopping centres in Poland,
European Logistics Investment for disposal of logistics project in Tychy,
Macquarie Asset Management for the acquisition of Żabka Polska BTS warehouse in Radzymin,
Union Investment acquisition of the commercial parts of Szervita Square Building,
W. P. Carey Inc. acquisition of seven OBI Group Holding retail stores in Poland.
Congratulations to all nominees and see you all next week in Warsaw!
Fight for warehouse space
Very interesting report by Business Insider about the fight for warehouse space between giants such as Prologis and Blackstone followed by many other financial institutions.
"(...) big money is buying up warehouse space as fast as smaller owners can sell.
The coronavirus pandemic accelerated this change, with warehouse investment outpacing office investment in 2020 and 2021, according to CBRE".
Source: Business Insider
BNP Paribas Real Estate Report - summary
We highly recommend the BNP Paribas Real Estate report - "Report Poland Magnified" about the state of the economy and the real estate market. Below is our short summary on warehouses and logistics:
✅ the vacancy rate is only 3.1%,
✅ warehouses and logistics are the fastest growing sector in Poland - an increase of 19.5% y / y,
✅ invariably the largest markets are Warsaw, Upper Silesia and Central Poland,
✅ rents increased on average by 9% compared to the two previous quarters.
Source: BNP Paribas Real Estate
Galloping demand for warehouses
According to Anna Gołasa, a journalist from Puls Biznesu - "In mid-2022, the warehouse market in Poland set down a record low vacancy rate - 3.1%. Developers confirm that new facilities almost immediately disappear from the market". The growth trend in the warehouse property market is more and more visible, currently developers are building more than ever, and yet new space is spreading very quickly. The low vacancy rate shows how high demand is and indicates that the market is still insatiable and needs more warehouses.
Source: Puls Biznesu
Investments in warehouses are still on top
According to the data, the logistics and warehouse market is responsible for approximately half of all sales transactions to the target investor in the commercial real estate market. “Logistics and warehouse assets are perceived as safe and with low risk. Such properties are consequently sold at low yields. And the lower the yield, the higher the value. "
Source: Rzeczpospolita
