Demand Strong for Prime Logistics Space in

Transcription

GLOBAL PRIME LOGISTICS RENTS
M AY 2 0 1 6
Demand Strong for Prime
Logistics Space in Global Hubs
CBRE RESEARCH
Executive Summary
Supply chain transformation driving up prime
logistics rents
urban areas with larger land supplies are showing the lowest rents,
Despite a tumultuous global economic climate in 2015, prime
including U.S. hubs like Chicago, Dallas-Ft. Worth and Atlanta.
these are extremely dense cities with land constraints. Conversely,
logistics rents in global hub markets increased 2.8% year-overyear amid growing demand—driven principally by the growth
U.S. coastal hubs seeing exceptional growth
of global supply chains and the expansion of consumption and
In the Americas, prime logistics rents increased 5.6% during
production into new locations. Of the 68 global hubs tracked
2015, largely due to massive growth in U.S. coastal markets,
in this report, 59% (40 markets) recorded an annual increase in
where strong occupier demand drove up pricing. In Oakland,
prime rents, 25% (17 markets) experienced no change and only
which recorded the largest annual increase in prime rents globally,
16% (11 markets) saw decreases.
flight-to-quality is common for inner-bay logistics users despite
the high cost. New development in some markets, like the Inland
Why are logistics rents growing?
Empire, is commanding premium rates.
Rent growth stems from strong occupier demand for logistics
space throughout each region, driven by a focus on expanding
Asia Pacific markets resilient despite China slowdown
and modernizing the supply chain. In many of the core hub
Prime rents for space in logistics facilities in Asia Pacific rose
markets, supply for prime logistics space is extremely tight,
by 2.5% over the past year, with Seoul and Auckland recording
placing pressure on the prime rents. Furthermore, a scarcity
growth rates of more than 5%, driven by robust demand from
of suitable development sites, especially in the U.S., has limited
e-commerce and third-party logistics firms.
the development of new supply despite persistent user demand.
Finally, factors such as supportive government policies, strong
Moderate increases in EMEA prime logistics rents
e-commerce growth and the modernization of the logistics
Rents in EMEA ticked up a modest 0.8% year-over-year, but
industry has contributed to rent growth.
there were large differences, with land-constrained markets
showing rising rents, while hubs in markets with ample
Land-constrained hubs most expensive, U.S. markets
most affordable
development potential, for example in the Netherlands or
in Poland, remained flat.
Hong Kong is the world’s most expensive logistics market,
followed by London and Tokyo. This is not surprising, considering
CBRE Research | Global Prime Logistics Rents, May 2016
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© 2016 CBRE, Inc.
The 10 Fastest Growing Markets
(Annual percent change in prime logistics rents as of Q4 2015)
4
1
37
6 8
9
2
10
5
1
2
3
4
5
Oakland
29.8%
New Jersey
15.0%
Inland Empire
U.K. Midlands
13.0%
Santiago
10.9%
6
7
8
9
10
Ciudad Juárez
Los Angeles–
Orange County
Dallas–
Ft. Worth
Atlanta
Seoul
10.2%
9.8%
13.5%
8.0%
6.8%
6.5%
Source: CBRE Research, Q4 2015.
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© 2016 CBRE, Inc.
The 10 Most Expensive Markets
(Ranked on a US$ per sq. ft. per annum basis; foreign exchange rate as of 12/31/2015)
5
78
3
10
1
6
2
4
9
1
2
3
4
5
Hong Kong
Tokyo
London
Singapore
Stockholm
$28.94
$16.74
$16.36
$10.91
6
7
8
9
10
Shanghai
Manchester–
Liverpool
Leeds–
Sheffield
Sydney
Shenzhen
$9.44
$8.75
$8.45
$8.34
$9.90
$8.27
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© 2016 CBRE, Inc.
Introduction
Over the past two decades, there has been a dramatic trans-
or 10,000 sq. m., in size—in many cases, much larger than
formation in global trade and the industrial real estate market.
that—with clear ceiling heights of at least 26 feet, or 8 meters,
Today, industrial and logistics facilities are at the heart of rapidly
to accommodate high-tech stacking racks and automated storage
evolving and expanding global supply chains and trade networks,
and retrieval systems, and have more loading docks—typically
serving as vital cogs in storing and moving billions of products
one for every 10,000 sq. ft., or 1,000 sq. m., of storage space—
across multimodal transportation networks worldwide at speeds
to ensure rapid and efficient throughput of goods in and out
once thought unimaginable.
of the facility. They are materially more expensive to build and
to lease than lower-grade industrial facilities.
At the same time, an ever-increasing share of retail sales—
7.5% today, up from 5.6% in early 2013, according to eMarketer
Location also matters more than ever. Sophisticated supply chain
—is taking place over the Internet, prompting both traditional
schemes require locations that are near or directly connected
retailers and e-commerce companies to reshape their supply
to transportation networks to take in goods, and, at the same time,
chain organizations in key markets to fulfill online orders as
need to be well-connected to—or even located within—major
quickly as possible. Moreover, manufacturers and other industrial
metros to deliver goods to the end user as quickly as possible.
Industrial and logistics distribution facilities are at the heart
of rapidly evolving and expanding global supply chains and
trade networks
users are implementing more advanced “just-in-time” schemes
Moreover, more firms are seeking smaller light industrial infill
to optimize inventory costs, and keeping customers happy, further
facilities to supplement their big boxes, stocking them with
stimulating demand for warehouse facilities.
the most in-demand products and partnering with local courier
services to gain a speed-to-market advantage over competitors.
However, not all industrial assets are equal. Advanced logistics
users require modern big-box centers, which often have highly
With this prime segment of the market becoming ever more
specialized features not often found in the typical warehouse.
important to the operations of logistics users—as well as to
These “prime” facilities typically are at least 100,000 sq. ft.,
the bottom line of real estate owners and investors—CBRE
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© 2016 CBRE, Inc.
Research has created this new semiannual report to enable
Secondly, land-constrained markets command a significant
readers to compare and understand prime rent values in 68
rent premium over other markets. Most of the hubs on the most
key logistics hubs around the world, ranking them from most
expensive list are markets where available land for industrial
expensive to least. We segment out older, non-like facilities
development is limited and expensive. Markets where land is
from the data set and report rent values on a dollar-per-sq.-ft.
more plentiful—most notably major U.S. hubs like Chicago,
basis to ensure a like-for-like comparison across markets.
Dallas-Ft. Worth and Atlanta—are far more affordable.
Occupiers in most parts of the world should expect these trends
to persist for a while— and plan accordingly
Finally, there is new development taking place to meet the rising
The results show three clear trends. Firstly, prime rent levels
are resilient despite the recent economic headwinds, with prime
demand for prime space. However, this likely won’t alleviate
industrial rents at the same or higher level from year-end 2014
rent pressures, as these facilities will remain in high demand
in 85% of the tracked markets, and the global average up 2.8%
thanks to the secular shift in e-commerce and trade. In other
year-over-year. This is true even in Asia Pacific, which saw a 2.5%
words, occupiers in most parts of the world (with some notable
year-over-year rise in prime rents despite the slowdown of the
exceptions outlined later on) should expect these trends to persist
Chinese economy.
for a while—and plan accordingly.
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© 2016 CBRE, Inc.
Regional Performance
Americas markets post strong gains,
EMEA and Asia Pacific more mixed
In the U.S., achievable prime industrial rents appreciated in
this segment have risen significantly in some areas, especially
most markets, with the strongest growth in coastal hubs like
in infill submarkets that are well positioned to serve the
Oakland, New Jersey and the Inland Empire. Other markets
urban core.
in the Americas that saw strong gains in 2015 included Santiago,
Ciudad Juárez and Los Angeles-Orange County. These are
European markets saw more marginal gains overall, with several
major global and regional hubs that are targeted by many
hubs experiencing no growth at all. The U.K. Midlands, London
logistics users thanks to their large catchment areas (the size
and Berlin saw the strongest growth, with an average of 7.9%
of the market that the hubs have access to) and access to key
year-over-year growth in prime industrial rents. These areas are
supply chain infrastructure.
seeing increased demand from e-commerce-related users as
more Europeans shop online. Many other hubs are profiting from
Markets in the Americas are seeing strong demand for high-
growing consumer spending, but any upward pressure on rents
quality industrial space from supply chain users, and the
is being alleviated by new development, which, in an environment
availability of Class A product continues to decline in most
of declining yields, can be offered against favorable rents.
Markets in the Americas are seeing strong demand for
high-quality industrial space from supply chain users, and
the availability of Class A product continues to decline in
most locations
locations. Furthermore, there is an increased emphasis on
On the other end of the spectrum, Moscow had the deepest
speed-to-market delivery schemes, with e-commerce continuing
decline, showing a 45.8% drop in prime industrial rents
to transform distribution networks. Big-box distribution
(measured in U.S. dollars) due to declining oil prices that
centers are no longer the only focal point among occupiers—
have led to recessionary conditions. The Moscow market has
light distribution facilities located near or within major metros
adapted to a lower level of occupier activity and will need
are growing more popular with users seeking to meet consumer
to digest the surplus space that was developed speculatively
demands for same- and next-day delivery of goods. Rents in
before the economic downturn set in.
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© 2016 CBRE, Inc.
Annual Change Breakdown Q4 2014–Q4 2015
THE AMERICAS
EMEA
A PA C
GLOBAL
5.6%
0.8%
2.5%
2.8%
growth in prime rent
CHANGES BY MARKET
THE AMERICAS
16
increases
EMEA
2
decreases
9
increases
A PA C
13
1
unchanged
15
decrease
increases
5
unchanged
7
decreases
U.S. markets lead growth, Chinese markets faring well
TOP 5 GROWTH MARKETS BY REGION
29.8%
13.5%
13.0%
5.0%
5.0%
5.0%
Nanjing
5.2%
Hangzhou
4.2%
Ningbo
4.2%
Seoul
6.5%
4.3%
Barcelona
London
Midlands
Ciudad Juárez
Santiago
Inland Empire
New Jersey
Oakland
6.2%
Auckland
10.2%
Milan
10.9%
Berlin
15.0%
China is an emerging market with large increases in completions every year, and these new properties skew the spot rent. To prevent this, CBRE Research has made the
appropriate adjustments to the % changes to reflect a “like-for-like” in rental growth.
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© 2016 CBRE, Inc.
Despite the slowdown in China’s economy, 15 out of the 27
have fared relatively well, with the U.S. continuing to lead
markets tracked in Asia Pacific experienced rent growth. Third-
global growth. Due to China’s ongoing transformation from
party logistics firms and retailers are taking a longer-term view
a manufacturing economy towards a consumption-based
and continue to upgrade their distribution networks.
economy, the demand for commodities has fallen. China is
responsible for 14% of the world’s oil imports, 58% of the world’s
Seoul recorded 6.5% annual growth in prime rents as supportive
soybean imports and 58% of the world’s iron ore imports.1
government policies, strong e-commerce growth and the
Thus, the slowdown in China is a major contributor to the
modernization of the logistics industry continues in South Korea.
negative sentiment for commodities. Simultaneously, supply
The small, open economies of Hong Kong and Singapore showed
of commodities, such as oil, is at an all-time high, with the U.S
some weakness in rents as regional trade slowed, though they
now competing for Asian markets as it continues its growth
remain among the most expensive industrial markets worldwide.
in domestic production. Consequently, we have seen a dramatic
Rising rents can be attributed to shrinking supply amid strong
collapse in prices, and this is having a significant impact on
occupier demand for Class A/Grade A logistics space in prime
the global economy.
The year-end 2015 availability rate in the U.S. was 510 basis
points lower than its recessionary peak of 14.5%, and stood at
its lowest point since 2001
The fall in commodity prices is undoubtedly good for most
locations. In EMEA, growth can be seen in markets where there
is less opportunity for new development due to land constraints—
advanced economies and net importer countries, with lower
a factor driving up rents in hubs in the U.K., Germany and Spain.
gas (petrol) prices allowing consumers to spend more, helping
In the Americas, the demand for this type of product is outpacing
boost the retail and industrial sectors and spurring demand
supply, with the availability rate rapidly declining in several
for logistics space. On the other hand, falling commodity prices
markets. The year-end 2015 availability rate in the U.S. was 510
are bringing headline inflation rates down and causing economic
basis points (bps) lower than its recessionary peak of 14.5%,
weaknesses in some producing countries, such as Russia,
and stood at its lowest point since 2001. Thus, increasingly tight
Australia, and Brazil, where we have seen a significant decrease
supply, coupled with healthy demand from supply chain and
in industrial rent.
distribution users, have helped strong rent growth in major and
Overall, global consumer demand is strong and fundamentals
emerging hubs throughout the U.S.
remain positive for prime and well-located logistics space.
One of the main drivers of this continues to be e-commerce,
The global economy has been hit with some recent challenges,
most notably the slowdown in China as well as exchange rate
contributing to the growth and expansion of global and emerging
volatility in Asian and European markets. Mature economies
hubs. E-commerce sales in the U.S. are expected to grow to more
1. http://marketrealist.com/2015/10/muted-demand-for-commodities/
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© 2016 CBRE, Inc.
Figure 1: Regional Performance, Year-over-Year Change in Rent (Ranked by the change in prime taking rent in the local unit per annum as of Q4 2015)
Rank
Market
% Change
Country
Region
Rank
1
Oakland
2
Market
29.8%
United States
Americas
35
Chongqing
New Jersey
15.0%
United States
Americas
36
3
Inland Empire
13.5%
United States
Americas
4
Midlands
13.0%
United Kingdom
5
Santiago
10.9%
6
Ciudad Juárez
10.2%
7
LA / Orange County
8
% Change
Country
Region
2.1%
China
APAC
Mexico City
2.0%
Mexico
Americas
37
Houston
1.2%
United States
Americas
EMEA
38
Dalian
0.4%
China
APAC
Chile
Americas
39
South Florida
0.3%
United States
Americas
Mexico
Americas
40
Toronto
0.2%
Canada
Americas
9.8%
United States
Americas
41
Wuhan
0.0%
China
APAC
Dallas / Ft. Worth
8.0%
United States
Americas
42
Manchester / Liverpool
0.0%
United Kingdom
EMEA
9
Atlanta
6.8%
United States
Americas
43
Stockholm
0.0%
Sweden
EMEA
10
Seoul
6.5%
South Korea
APAC
44
Tianjin
0.0%
China
APAC
11
London
6.2%
United Kingdom
EMEA
45
Frankfurt
0.0%
Germany
EMEA
12
Auckland
5.2%
New Zealand
APAC
46
Hamburg
0.0%
Germany
EMEA
13
Ningbo
5.0%
China
APAC
47
Dusseldorf / Cologne
0.0%
Germany
EMEA
14
Hangzhou
5.0%
China
APAC
48
Rotterdam
0.0%
Netherlands
EMEA
15
Nanjing
5.0%
China
APAC
49
Ruhr
0.0%
Germany
EMEA
16
Wuxi
5.0%
China
APAC
50
Amsterdam
0.0%
Netherlands
EMEA
17
Suzhou
4.9%
China
APAC
51
Madrid
0.0%
Spain
EMEA
18
Seattle
4.9%
United States
Americas
52
Tilburg/Eindhoven/Venlo
0.0%
Netherlands
EMEA
19
Berlin
4.3%
Germany
EMEA
53
Budapest
0.0%
Hungary
EMEA
20
Shanghai
4.3%
China
APAC
54
Warsaw
0.0%
Poland
EMEA
21
Philadelphia
4.3%
United States
Americas
55
Antwerp
0.0%
Belgium
EMEA
22
Milan
4.2%
Italy
EMEA
56
Qingdao
0.0%
China
APAC
23
Barcelona
4.2%
Spain
EMEA
57
Canberra
0.0%
Australia
APAC
24
Munich
3.8%
Germany
EMEA
58
Shenyang
0.0%
China
APAC
25
Shenzhen
3.8%
China
APAC
59
Tokyo
-1.3%
Japan
APAC
26
Leeds / Sheffield
3.8%
United Kingdom
EMEA
60
Brisbane
-1.5%
Australia
APAC
27
Chicago
3.8%
United States
Americas
61
Singapore
-1.6%
Singapore
APAC
28
Prague
3.6%
Czech Republic
EMEA
62
Hong Kong
-1.8%
Hong Kong, China
APAC
29
Paris
3.4%
France
EMEA
63
Monterrey
-2.4%
Mexico
Americas
30
Chengdu
3.2%
China
APAC
64
Melbourne
-3.3%
Australia
APAC
31
Beijing
2.9%
China
APAC
65
Adelaide
-3.9%
Australia
APAC
32
Sydney
2.4%
Australia
APAC
66
Perth
-6.1%
Australia
APAC
33
Bajío
2.2%
Mexico
Americas
67
São Paulo
-10.5%
Brazil
Americas
34
Guangzhou
2.2%
China
APAC
68
Moscow
-45.8%
Russia
EMEA
Ranked by 12-month % change increases as of Q4 2015. Rents are based on achievable rents on net floor area basis, exclusive of taxes, expenses and service changes.
China is an emerging market with large increases in completions every year. These new properties skew the spot rent. To prevent this, CBRE Research has adopted “like-for-like”
rental growth numbers which doesn’t include the new completions until a stabilization period.
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© 2016 CBRE, Inc.
than $400 billion in the next several years, with Forrester Research
Similar to Japan a decade ago, the Korean logistics market
estimating $414 billion in sales in 2018 and eMarketer estimating
is undergoing modernization. The transformative effects of
e-commerce and the search for greater efficiency among third-
an average growth of 15% from 2016.2
party logistics firms is spurring demand for modern logistics
Industrial owners and occupiers are adjusting to this growing
facilities in Seoul. Development has been shifting from southern
trend. The underlying demographic shifts are a key factor here,
Seoul (Yongin, Incheon) to western Seoul (Incheon, Ansan,
and as living standards around the world continue to rise, new
Pyeongtaek) due to greater land availability, infrastructure
markets and customer segments are opening to global suppliers.
developments, and increased international trade over the years.
Strong population growth in emerging markets has altered
the shape of consumption and distribution networks in place
In Europe, consumer spending online is expected to grow more
to serve these populations.
on the mainland than in the U.K., which is already a global leader
E-commerce sales in the U.S. are expected to grow to more
than $400 billion in the next several years, with Forrester
Research estimating $414 billion in sales in 2018
In China, for example, e-commerce has taken off in first-
in terms of e-commerce sales, accounting for one in three of
and second-tier cities. Despite the overall economic slow-
all European purchases made by consumers over the Internet.
down in China, demand remains for logistics facilities in
With limited land supply in most markets, the ability to develop
Shanghai, driven by fashion retailers, e-commerce and third-
large-scale inner city warehousing is constrained. In response
party logistics firms.
to this, operators have been forced to create networks of smaller
delivery sites on the periphery, connected through one or more
“hub” warehouses in strategic locations. The rise of such urban
In addition, logistics land supply are becoming more limited
as local governments are reluctant to release land for logistics
distribution facilities is mostly visible in Europe’s biggest cities,
development due to lack of tax revenues generated from
such as London, Paris and Madrid, but is increasingly impacting
such projects. As a result, there is continued interest in
mid-sized cities too. As the logistics industry in Europe responds
logistics by developers and investors. Pension funds and
to the need for greater economies of scale, there have been
private equity players have co-invested into the China logistics
several mergers, acquisitions and restructurings, resulting in
sector, demonstrating the structural lack of modern logistics
a consolidation of the warehouse footprint.
facilities in the country, especially the tier-one cities.
2. https://www.internetretailer.com/trends/sales/us-e-commerce-sales-2013-2017/
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© 2016 CBRE, Inc.
Furthermore, some hubs in the Americas are in a cycle of new
In South America, there is uneven growth, with São Paulo
development as they respond to limited supply, particularly
experiencing a sharp year-over-year decline industrial rents.
in the Class A segment. In the U.S., the fourth quarter of 2015
This can largely be attributed to the recession and political
saw 44.7 million sq. ft. completed, with an additional 183 million
unrest in Brazil, which has hampered growth in arguably the
sq. ft. under construction. Speculative development has become
most significant South American hub. On the other hand,
prevalent and represents the majority of new development
Santiago, despite some economic uncertainty, has seen strong
in most core markets in the U.S. This, coupled with falling
rent growth. This market has benefited from the growth of
availability and strong leasing demand, has pushed sustained
Port San Antonio, one of the fastest-growing ports in Latin
national rent growth.
America and a key gateway to Asian markets, and this is reflected
in the success of prime logistics facilities in this emerging
global hub.
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© 2016 CBRE, Inc.
Most Expensive Global Hubs
Hong Kong, Tokyo and London top list;
No U.S. markets among the top 10
Hong Kong has the most expensive rents for prime logistics
The other eight of the top 10 high-priced industrial hubs
space in the world, at $28.94 per sq. ft. per annum. This is due to
are in EMEA and Asia Pacific, including London, Singapore,
the unique high-rise nature of the market, as prime warehouses
Stockholm, Shanghai, Manchester-Liverpool, Leeds-Sheffield,
are multi-story properties with ramp-access to each individual
Sydney and Shenzhen.
Hong Kong has the most expensive rents for prime logistics
space due to the unique high-rise nature of the market
floor, making the gross to net efficiency ratio much lower than
Of the top 15 markets with the most expensive achievable rent,
the traditional single-story logistics facilities found elsewhere
only one is in the Americas: Los Angeles / Orange County.
in the world. As a result, rents in Hong Kong are 73% greater
than the second most expensive market, Tokyo, where the
The lower-priced markets are mostly located in the Americas
average prime rent ended 2015 at $16.74 per sq. ft. per annum.
and Asia Pacific, including Nanjing, Toronto, Chicago, DallasFort Worth and Atlanta. These hubs have achievable rates ranging
from $3.13 to $4.43 per sq. ft. per annum.
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© 2016 CBRE, Inc.
Figure 2: Global Prime Logistics Rent, Most Expensive (Ranked by prime taking rent in US$ per sq. ft. per annum as of Q4 2015)
Rank
Market
Rent
Country
Region
Rank
Market
Rent
Country
Region
1
Hong Kong
$28.94
Hong Kong, China
APAC
35
Madrid
$6.08
Spain
EMEA
2
Tokyo
$16.74
Japan
APAC
36
Ningbo
$6.02
China
APAC
3
London
$16.36
United Kingdom
EMEA
37
Hangzhou
$5.88
China
APAC
4
Singapore
$10.91
Singapore
APAC
38
Berlin
$5.83
Germany
EMEA
5
Stockholm
$9.90
Sweden
EMEA
39
Ruhr
$5.65
Germany
EMEA
6
Shanghai
$9.44
China
APAC
40
Adelaide
$5.65
Australia
APAC
7
Manchester / Liverpool
$8.75
United Kingdom
EMEA
41
Mexico City
$5.61
Mexico
Americas
8
Leeds / Sheffield
$8.45
United Kingdom
EMEA
42
Wuhan
$5.61
China
APAC
9
Sydney
$8.34
Australia
APAC
43
Chongqing
$5.58
China
APAC
10
Shenzhen
$8.27
China
APAC
44
Tilburg/Eindhoven/Venlo
$5.57
Netherlands
EMEA
11
Munich
$8.21
Germany
EMEA
45
Budapest
$5.47
Hungary
EMEA
12
LA / Orange County
$8.04
United States
Americas
46
Melbourne
$5.43
Australia
APAC
13
Seoul
$7.94
South Korea
APAC
47
Tianjin
$5.37
China
APAC
14
Brisbane
$7.85
Australia
APAC
48
Prague
$5.29
Czech Republic
EMEA
15
Perth
$7.67
Australia
APAC
49
Santiago
$5.24
Chile
Americas
16
Barcelona
$7.60
Spain
EMEA
50
Seattle
$5.16
United States
Americas
17
Houston
$7.59
United States
Americas
51
Ciudad Juárez
$5.10
Mexico
Americas
18
Beijing
$7.57
China
APAC
52
Bajío
$5.07
Mexico
Americas
19
Frankfurt
$7.54
Germany
EMEA
53
Milan
$5.07
Italy
EMEA
20
Canberra
$7.39
Australia
APAC
54
Inland Empire
$5.04
United States
Americas
21
Oakland
$7.32
United States
Americas
55
Shenyang
$5.01
China
APAC
22
Midlands
$7.09
United Kingdom
EMEA
56
Philadelphia
$4.90
United States
Americas
23
Auckland
$7.01
New Zealand
APAC
57
Warsaw
$4.86
Poland
EMEA
24
Hamburg
$6.93
Germany
EMEA
58
São Paulo
$4.79
Brazil
Americas
25
Suzhou
$6.78
China
APAC
59
Wuxi
$4.78
China
APAC
26
Rotterdam
$6.58
Netherlands
EMEA
60
Dalian
$4.76
China
APAC
27
Moscow
$6.58
Russia
EMEA
61
Antwerp
$4.66
Belgium
EMEA
28
New Jersey
$6.58
United States
Americas
62
Qingdao
$4.56
China
APAC
29
$6.56
Germany
EMEA
63
Monterrey
$4.46
Mexico
Americas
30
South Florida
$6.51
United States
Americas
64
Nanjing
$4.43
China
APAC
31
Amsterdam
$6.28
Netherlands
EMEA
65
Toronto
$4.19
Canada
Americas
32
Guangzhou
$6.13
China
APAC
66
Chicago
$4.13
United States
Americas
33
Chengdu
$6.13
China
APAC
67
Dallas / Ft. Worth
$3.76
United States
Americas
34
Paris
$6.08
France
EMEA
68
Atlanta
$3.13
United States
Americas
Rents are based on achievable rates, exclusive of taxes expenses, and service changes. Source: CBRE Research, Q4 2015.
14
© 2016 CBRE, Inc.
Figure 3: Americas Prime Logistics Rents, Q4 2015
Local Measure
Market
Primary Hub
Market
USD Per Sq. Ft.
EUR Per Sq. M.
Local Currency
& Measure
Avg. Achievable
Rent
Y-o-Y Change
Avg. Achievable
Rent
Y-o-Y Change
Avg. Achievable
Rent
Y-o-Y Change
Oakland
Oakland
USD sq. ft. p. m.
0.61
29.8%
7.32
29.8%
72.26
44.1%
New Jersey
New Jersey
USD sq. ft. p. a.
6.58
15.0%
6.58
15.0%
64.95
27.7%
Inland Empire
Inland Empire
USD sq. ft. p. m.
0.42
13.5%
5.04
13.5%
49.75
26.0%
Santiago
Santiago
USD sq. ft. p. m.
0.13
10.9%
5.24
-2.1%
51.73
8.7%
Ciudad Juárez
Ciudad Juárez
USD sq. ft. p. a.
5.10
10.2%
5.10
10.2%
50.34
22.3%
LA / Orange County
LA / Orange County
USD sq. ft. p. m.
0.67
9.8%
8.04
9.8%
79.37
21.9%
Dallas / Ft. Worth
Dallas / Ft. Worth
USD sq. ft. p. a.
3.76
8.0%
3.76
8.0%
37.12
19.9%
Atlanta
Atlanta
USD sq. ft. p. a.
3.13
6.8%
3.13
6.8%
30.90
18.6%
Seattle
Seattle
USD sq. ft. p. m.
0.43
4.9%
5.16
4.9%
50.94
16.4%
Philadelphia
Philadelphia
USD sq. ft. p. a.
4.90
4.3%
4.90
4.3%
48.37
15.7%
Chicago
Chicago
USD sq. ft. p. a.
4.13
3.8%
4.13
3.8%
40.77
15.2%
Bajio
Bajio
USD sq. ft. p. m.
4.55
2.2%
5.07
2.2%
50.09
13.5%
Mexico City
Mexico City
USD sq. ft. p. m.
5.03
2.0%
5.61
2.0%
55.38
13.3%
Houston
Houston
USD sq. ft. p. a.
7.59
1.2%
7.59
1.2%
74.93
12.3%
South Florida
Miami
USD sq. ft. p. a.
6.51
0.3%
6.51
0.3%
64.26
11.4%
Toronto
Toronto
USD sq. ft. p. a.
5.81
0.2%
4.19
-16.2%
41.41
-6.9%
Monterrey
Monterrey
USD sq. ft. p. m.
4.00
-2.4%
4.46
-2.4%
44.04
8.3%
São Paulo
São Paulo
USD sq. ft. p. m.
17.00
-10.5%
4.79
-40.0%
47.26
-33.4%
15
© 2016 CBRE, Inc.
Figure 4: Asia Pacific Prime Logistics Rents, Q4 2015
Local Measure
Market
Primary Hub
Market
Local Currency
& Measure
Avg. Achievable
Rent
USD Per Sq. Ft.
EUR Per Sq. M.
Y-o-Y Change
Avg. Achievable
Rent
Y-o-Y Change
Avg. Achievable
Rent
Y-o-Y Change
27700.00
6.5%
7.94
-1.1%
78.41
9.8%
Seoul
Seoul
KRW pyong p. m.
Auckland
Auckland
NZD sq. m. p. a.
111.00
5.2%
7.01
-8.3%
69.25
1.8%
Ningbo
Overall Market
RMB sq. m. p. m.
36.00
5.0%
6.02
0.4%
59.45
11.8%
Hangzhou
Overall Market
RMB sq. m. p. m.
35.17
5.0%
5.88
0.4%
58.08
11.8%
Nanjing
Nanjing Aviation
Logistics Park
RMB sq. m. p. m.
26.50
5.0%
4.43
0.4%
43.76
11.8%
Wuxi
Overall Market
RMB sq. m. p. m.
28.56
5.0%
4.78
0.4%
47.16
11.8%
Suzhou
Suzhou Industrial
Park
RMB sq. m. p. m.
40.56
4.9%
6.78
0.3%
66.97
11.7%
Shanghai
Waigaoqio
RMB sq. m. p. m.
56.45
4.3%
9.44
-0.3%
93.21
11.1%
Shenzhen
China Merchants
Bonded Logistics Park
RMB sq. m. p. m.
49.45
3.8%
8.27
-0.8%
81.65
10.5%
Chengdu
Aviation Submarket
RMB sq. m. p. m.
36.67
3.2%
6.13
-1.4%
60.55
9.9%
Beijing
Beijing Airport
Logistics Park
RMB sq. m. p. m.
45.28
2.9%
7.57
-1.7%
74.77
9.6%
Sydney
Sydney
AUD sq. m. p. a.
122.91
2.4%
8.34
-7.7%
82.32
2.4%
Guangzhou
Huangpu
RMB sq. m. p. m.
36.67
2.2%
6.13
-2.3%
60.55
8.8%
Chongqing
Airport Submarket
RMB sq. m. p. m.
33.34
2.1%
5.58
-2.4%
55.05
8.7%
Dalian
Dayaowan
RMB sq. m. p. m.
28.45
0.4%
4.76
-4.0%
46.97
6.9%
Wuhan
Huangpu & Dongxihu
RMB sq. m. p. m.
33.52
0.0%
5.61
-4.4%
55.35
6.5%
Tianjin
Primary Market
RMB sq. m. p. m.
32.11
0.0%
5.37
-4.4%
53.03
6.5%
Qingdao
Qingdao Airport
Logistics Park
RMB sq. m. p. m.
27.28
0.0%
4.56
-4.4%
45.04
6.5%
Canberra
Canberra
AUD sq. m. p. a.
109.00
0.0%
7.39
-9.9%
73.00
0.0%
Shenyang
Hunnan
RMB sq. m. p. m.
29.95
0.0%
5.01
-4.4%
49.45
6.5%
Tokyo
Tokyo Bay Area
JPY tsubo p. m.
5950.00
-1.3%
16.74
-1.3%
165.27
9.5%
Brisbane
Brisbane
AUD sq. m. p. a.
115.71
-1.5%
7.85
-11.2%
77.49
-1.5%
Singapore
Singapore
SGD sq. ft. p. m.
1.28
-1.6%
10.91
-7.5%
107.72
2.6%
Hong Kong
Hong Kong
HKD sq. ft. p. m.
18.84
-1.8%
28.94
-1.8%
285.67
9.0%
Melbourne
Melbourne
AUD sq. m. p. a.
80.00
-3.3%
5.43
-12.9%
53.58
-3.3%
Adelaide
Adelaide
AUD sq. m. p. a.
83.33
-3.9%
5.65
-13.3%
55.81
-3.8%
Perth
Perth
AUD sq. m. p. a.
113.06
-6.1%
7.67
-15.4%
75.72
-6.1%
China is an emerging market with large increases in completions every year, and these new properties skew the spot rent. To prevent this, CBRE Research has made the
appropriate adjustments to the % changes to reflect a “like-for-like” in rental growth.
16
© 2016 CBRE, Inc.
Figure 5: EMEA Prime Logistics Rents, Q4 2015
Local Measure
Market
Primary Hub
Market
Local Currency
& Measure
USD Per Sq. Ft.
EUR Per Sq. M.
Avg. Achievable
Rent
Y-o-Y Change
Avg. Achievable
Rent
Y-o-Y Change
Avg. Achievable
Rent
Y-o-Y Change
Midlands
Birmingham
GBP sq. ft. p. a.
6.50
13.0%
7.09
1.8%
94.95
0.5%
London
M25 Ring Road
GBP sq. ft. p. a.
11.13
6.2%
16.36
0.0%
154.49
6.2%
Berlin
Berlin
EUR sq. m. p. m.
4.80
4.3%
5.83
-6.0%
57.60
4.3%
Milan
Milan
EUR sq. m. p. a.
50.00
4.2%
5.07
-6.2%
50.00
4.2%
Barcelona
Barcelona
EUR sq. m. p. a.
75.00
4.2%
7.60
-6.2%
75.00
4.2%
Munich
Munich
EUR sq. m. p. m.
6.75
3.8%
8.21
-6.5%
81.00
3.8%
Leeds / Sheffield
Leeds
EUR sq. ft. p. a.
5.75
3.8%
8.45
-2.0%
84.14
9.4%
Prague
Prague
EUR sq. m. p. m.
4.35
3.6%
5.29
-6.7%
52.20
3.6%
Paris
Paris
EUR sq. m. p. a.
60.00
3.4%
6.08
-6.8%
60.00
3.4%
Manchester /
Liverpool
Manchester
GBP sq. ft. p. a.
5.95
0.0%
8.75
-6.0%
82.59
0.0%
Stockholm
Stockholm
SEK sq. m. p. a.
900.00
0.0%
9.90
-7.6%
98.30
3.5%
Amsterdam
Amsterdam
EUR sq. m. p. a.
62.00
0.0%
6.28
-9.9%
62.00
0.0%
Antwerp
Antwerp
EUR sq. m. p. a.
46.00
0.0%
4.66
-9.9%
46.00
0.0%
Budapest
Budapest
EUR sq. m. p. m.
4.50
0.0%
5.47
-9.9%
54.00
0.0%
Dusseldorf
EUR sq. m. p. m.
5.40
0.0%
6.56
-9.9%
64.80
0.0%
Frankfurt
Frankfurt
EUR sq. m. p. m.
6.20
0.0%
7.54
-9.9%
74.40
0.0%
Hamburg
Hamburg
EUR sq. m. p. m.
5.70
0.0%
6.93
-9.9%
68.40
0.0%
Madrid
Madrid
EUR sq. m. p. a.
60.00
0.0%
6.08
-9.9%
60.00
0.0%
Rotterdam
Rotterdam
EUR sq. m. p. a.
65.00
0.0%
6.58
-9.9%
65.00
0.0%
Ruhr
Duisburg
EUR sq. m. p. m.
4.65
0.0%
5.65
-9.9%
55.80
0.0%
Tilburg / Eindhoven /
Venlo
Eindhoven
EUR sq. m. p. a.
55.00
0.0%
5.57
-9.9%
55.00
0.0%
Warsaw
Waraw
EUR sq. m. p. m.
4.00
0.0%
4.86
-9.9%
48.00
0.0%
Moscow
Moscow
USD sq. m. p. a.
65.00
-45.0%
6.58
-41.0%
65.00
-34.4%
17
© 2016 CBRE, Inc.
Methodology & Definitions
Methodology
of achievable net rental rates for high quality, Grade A logistics
This report outlines rents for prime logistics facilities in 68
space in traditional and emerging global hubs. Since industrial
global hubs in the Americas, Asia Pacific and EMEA as of Q4 2015.
lease rates can vary substantially in each market and depending
Data in this analysis is derived from achievable rents on a net
on the particular transaction, this data is meant to provide
floor area, exclusive of taxes, expenses, and service charges. Top
comparative benchmarks only.
market rent was gathered based on industrial distribution space
of the highest quality and specification, and in the best location
Explanation of Columns
within each industrial hub. The chosen hubs are reflective of
Percentage Change: Documents the rate of change in local
CBRE’s “Global and Emerging Logistics Hubs” report from 2015
rents over the preceding 12 months. These changes are calculated
that explores the traditional global markets as well as the “up-
on the basis of local currency values to avoid distortions from
and-coming” areas that are growing rapidly. These hubs are based
exchange rate fluctuations.
on a broad set of logistics performance factors divided into three
categories: infrastructure and accessibility, market size, and
Average Achievable Rent—Local Currency/Measure: The rent
business environment.
quoted is the typical “achievable” rent from logistics properties
aligning with our key variables. Rents are expressed as the “face”
Before capturing the rent data, a set of guidelines were established
rates, without accounting for any tenant incentives that may be
in order to make an even comparison throughout the hubs. The
necessary to achieve it. Rents are stated in the local currency and
key variables for prime logistics buildings include:
prevailing unit of measure based on net floor area.
• Facilities greater than 100,000 sq. ft./10,000 sq. m. in size
• Clear ceiling height greater than 26-36 feet/ 8-10 meters
Rents in Japan and Korea are quoted as “tsubo per month” and
• Office space to industrial space ratio of no more than 10%
“pyeong per month.” respectively, which is approximately 35.58
sq. ft. based on the equivalent measurement of two tatami mats.
• Loading dock ratio of 1 dock: 10,000 sq. ft /1,000 sq. m. or less
• Building must be purpose-built for logistics and distribution
Regional and Global Percent Changes
(manufacturing facilities not included)
Aggregated changes in rental costs both at the global and regional
level are based on a weighted average of the rental change (local
Understandably, each market has its own set of criteria for
currency) in the individual cities. The weighting for each city is a
“prime” logistics space, and therefore the appropriate building
size, specifications, and loading dock ratio varies by market.
function of its country GDP, which is divided among the cities in
*
that country covered in the report according to the importance of
Terms and Definitions
each city as a commercial real estate market.
The global prime industrial rent survey provides a snapshot
*Some markets deviate from this criteria, such as New Zealand: size > 1,500 sq. m.; Hong Kong: clear ceiling height: 4 m.; Hong Kong: cargo-lift access buildings have
lower throughput; Tokyo: clear ceiling height: 5.5 m.; Tokyo: loading dock ratio 1 dock: 1,300 sq. m. China: loading dock ratio 1 dock: 1,300 sq. m.
18
© 2016 CBRE, Inc.
Contacts
Industrial & Logistics Research
CBRE Research Leadership
David Egan
Nick Axford, Ph.D.
Henry Chin, Ph.D.
Head of Industrial & Logistics Research, Americas
Head of Research, Global
Head of Research, Asia Pacific
+312 935 1892
+44 20 7182 2876
+852 2820 8160
david.egan2@cbre.com
nick.axford@cbre.com
henry.chin@cbre.com.hk
Twitter: @Egan2David
Twitter: @HenryChinPhD
Matthew Walaszek
Richard Barkham, Ph.D.
Spencer Levy
Senior Research Analyst, Global Industrial
Chief Economist, Global
Head of Research, Americas
& Logistics
+44 20 7182 2665
+1 410 951 8443
+1 312 297 7686
richard.barkham@cbre.com
spencer.levy@cbre.com
matthew.walaszek@cbre.com
Neil Blake, Ph.D.
Rosanna Tang
Head of Research, EMEA
Director, Asia Pacific Research
+44 20 7182 2133
+852 2820 2806
neil.blake@cbre.com
rosanna.tang@cbre.com.hk
Twitter: @neilblake123
Twitter: @SpencerGLevy
Jason Fong
Manager, Asia Pacific Research
+852 2820 2867
jason.fong@cbre.com.hk
Machiel Wolters
Head of Industrial & Logistics Research, EMEA
+31 20 626 26 91
machiel.wolters@cbre.com
Twitter: @MachielWolters
To learn more about CBRE Research, or to access additional research reports, please visit the Global Research Gateway at
www.cbre.com/researchgateway.
Disclaimer: Information contained herein, including projections, has been obtained from sources believed to be reliable. While we do not doubt its accuracy, we have not
verified it and make no guarantee, warranty or representation about it. It is your responsibility to confirm independently its accuracy and completeness. This information is
presented exclusively for use by CBRE clients and professionals and all rights to the material are reserved and cannot be reproduced without prior written permission of CBRE.

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