Although the current economic environment is proving challenging for most real estate asset classes, this supply/demand imbalance will likely put upward pressure on rental rates for well-located, modernized logistics assets as online consumption continues to penetrate the market, according to Cabot Properties.
Major Western European logistics markets are displaying attractive leasing fundamentals. Gross absorption remains in line with the 10-year average and continues to increase annually by roughly 4 percent. Strong leasing velocity has consistently outpaced new completions since 2015, keeping vacancy rates low as supply fails to keep pace with demand.
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