Significant rise in prime logistics rents almost everywhere in 2023

• Largest growth in Duisburg
• Munich remains most expensive market

FRANKFURT, 8 January 2024 - In almost all markets in Germany, prime rents for warehouse and logistics space have risen in 2023 compared to the previous year. Dortmund is the only exception among the analysed spaces of more than 5,000 m² in 19 markets: A significant increase in prime rents of 43 per cent was already recorded there in the previous year. Compared to the previous quarter, prime rents increased in six markets in the fourth quarter of 2023. A look at five years ago shows just how significantly rents have risen overall: Since then, prime rents have risen between 25 per cent (Stuttgart) and 67 per cent (Cologne and Essen).

Munich remains the most expensive market for warehouse and logistics space in Germany, with a prime rent of EUR 10.70/m² and only slight year-on-year growth of two per cent. It is followed at a considerable distance by Düsseldorf at EUR 8.75/m² (up 13 per cent), Stuttgart at EUR 8.50/m² (up two per cent) and Cologne (up 13 per cent). Duisburg recorded the largest year-on-year increase in prime rents at 23 per cent, while growth of 16 per cent was recorded in Erfurt. In addition to Duisburg, Essen (15 per cent), Düsseldorf and Cologne (13 per cent each) are among the other cities in the Rhine-Ruhr metropolitan region with the largest increases.

"The rising prime rents on the market for warehouse and logistics space in 2023 were characterised by low vacancy rates and demand exceeding supply. The fact that only slight momentum prevailed in some regions is also due to insufficient supply in these markets," says Sarina Schekahn, Head of Industrial & Logistics Agency JLL Germany. "The massive increase in costs and risks in the recent past have been passed on to rents. A higher proportion of built-to-suit developments compared to speculative developments tended to be reflected in higher rents. However, the shortage of space meant that there was a willingness to pay, at least in those sectors that were not affected by the persistently difficult economic situation, or only to a limited extent."

Compared to the previous quarter, Berlin recorded the strongest increase in prime rents in the fourth quarter, rising by seven per cent to EUR 8.00/m². Growth was only slightly lower at six per cent in Cologne (EUR 8.50/m²) and Magdeburg (EUR 5.10/m²). The six markets that showed positive momentum in the fourth quarter also include Erfurt (up four per cent) and Duisburg and Hanover/Brunswick (both up three per cent). Prime rents remained stable in the other 13 regions. Overall, momentum has therefore slowed somewhat compared to the previous quarter.

"The markets in central and eastern Germany in particular are increasingly showing the potential for further lettings, as the availability of space is increasing due to project developments and expiring leases as well as unused space (grey space). However, as in the rest of Germany, demand is perceived to be declining there," says Schekahn. "This could lead to stagnating or even slightly falling prime rents in 2024."

Rent index for warehouse and production space Q4 2023

Contact: Sarina Schekahn, Head of Industrial & Logistics Agency JLL Germany
Phone: +49 (0) 40 350011 149
Email: sarina.schekahn@jll.com

About JLL

For more than 200 years, JLL (NYSE: JLL), a leading global commercial property and investment management firm, has helped clients acquire, build, occupy, manage and invest in a wide range of commercial, industrial, hospitality, residential and retail properties. As a Fortune 500® company with annual revenues of $20.9 billion and offices in more than 80 countries worldwide, our approximately 105,000 employees offer the power of a global platform combined with local expertise. Driven by our goal of shaping the future of property for a better world, we help our customers, employees and society - true to our motto "SEE A BRIGHTER WAY".