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- July 1, 2021: Vol. 15, Number 7

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Logistics yields forecast to hit record lows in Europe

by Marek Handzel

Savills has predicted that European prime logistics yields will move in by –25 basis points this year, reaching a record low.

The adviser says that average achievable prime industrial yields were at 4.5 percent in the first quarter of 2020, and moved to 4.3 percent by the end of the year and a further five basis points in the first quarter of 2021 to 4.25 percent. The gradual decrease reflects the impact of large amounts of capital competing for limited assets in the market.

In its May 2021 Spotlight research paper, Savills highlights forecasts from research company Forrester, showing that the share of online shares in Western Europe will rise to 18 percent in 2021, having been at 11.9 percent in 2019. “Rising ecommerce penetration will continue to drive demand for logistics space in the coming years,” claims the paper. “Most importantly, the current supply of space is limited, and the supply of land around the major European cities is also restricted

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