European logistics investment activity reached €26.1bn to the end of Q3 2024 – a 14% increase compared with the same period last year, according to Savills’ latest European Logistics Outlook.
Q3 investment activity totalled €9.3bn – a 12% increase compared with the previous quarter and 23% higher than 2023’s figure. Although this remains below the five-year average, investment volumes remain on track to surpass €36bn by the end of 2024.
On a country-by-country level, the UK grew 50% year-on-year in Q3 with the €3.1bn invested into the market representing a third of all investment in the quarter.
The largest increases in annual terms were recorded in Austria (837%), the Czech Republic (744%) and France (146%), albeit this is coming off a very low base. The markets seeing the greatest decreases were Greece (89%), Norway (62%) and Germany (37%).
George Coleman, associate director in Savills’ EMEA industrial and logistics team, said: “We have seen a marked increase in stock coming to market in the UK during the Q4 transaction window, with the same trend carrying in to Europe, even if slightly delayed. There has been intense competition around the most liquid product type which signals a robust Q4 and generally a more positive sentiment forecast for 2025 in the EMEA market.”
Andrew Blennerhassett, associate in the industrial and logistics research team at Savills, added: “While investment volumes have undeniably started to improve, we could caveat that the market is characterised by a high level of caution. Investors remain focused on the trajectory of take-up and net-absorption, and the underperformance in these metrics is hampering a strong increase in investment volumes. However, well located, long income assets and reversionary mid-box/light industrial, is garnering significant interest across Europe.”
Leasing activity declined in the third quarter with the fall in take-up greater than typically expected. The 6m sq m of deals that transacted in the quarter represented a decrease of 20% compared with the previous quarter and 22% below Q3 2023.
With Q4 accounting for 27% of annual take-up since 2019, Savills anticipates that by year end totals will fall just short of 28m sq m compared to 29.7m sq m in 2023.
Sam Quellyn Roberts, global occupier services director, EMEA logistics markets at Savills, said: “In regards to occupier type, anecdotally we are seeing an increase in requirements and greater demand from Chinese car manufacturers (including parts, battery storage and EV). This tracks with previous predictions that locations such as central and eastern Europe (CEE) would gain the most benefit from onshoring due to competitive labour costs and government incentives. In addition, we have also seen several 3PLs expanding their footprint and healthy activity amongst automotive, pharma, food production and retail occupiers across the region.”
