Prime rents for logistics properties rise more slowly - Leipzig/Halle was an exception in the first quarter of 2024

FRANKFURT, 8 April 2024 - Prime rents on the market for warehouse and logistics space in Germany rose less sharply in the first quarter of 2024 than recently. In ten of the 19 markets analysed, prime rents for space of more than 5,000 m² increased, albeit mostly in the low single-digit percentage range. The only exception is Leipzig/Halle. Growth there was 13 per cent, with asking rents of up to EUR 6.20/m².

"With very little space immediately available, some occupiers in Leipzig/Halle had to make do with space in the higher-priced segment due to the pressure to act," says Sarina Schekahn, Head of Industrial & Logistics Agency JLL Germany. "Although the good market phase there has led to various speculative new builds, these are only gradually coming onto the market. Occupiers without acute pressure to act therefore have a greater choice, from which they often opt for the cheaper offer, as the competing space is of a comparable quality level."

Frankfurt recorded the second-largest growth in the first quarter of 2024 at five per cent (EUR 7.95/m²). Prime rents rose by three per cent in Düsseldorf (EUR 9.00/m²), Stuttgart (EUR 8.75/m²), Hamburg (EUR 8.50/m²), Berlin (EUR 8.25/m²) and Dresden (EUR 6.00/m²). There is further potential for rent increases in Dresden in particular, as the supply of space is barely increasing in contrast to demand. "The relocation of chip manufacturer TSMC to Dresden is sending positive economic signals and improving logistics network structures. Intel is creating similar potential in Magdeburg," says Schekahn.

In a year-on-year comparison, higher prime rents were recorded in almost all cities, with Leipzig/Halle once again recording the biggest change at 19 per cent in addition to Duisburg (EUR 8.00/m²). There were also significant increases of 13 per cent in Cologne (EUR 8.50/m²), ten per cent each in Berlin (EUR 8.25/m²) and Erfurt (EUR 5.30/m²) and nine per cent in Frankfurt (EUR 7.95/m²). The highest prime rents continue to be achieved in Munich at 10.70 euros/m², followed by Düsseldorf at 9.00 euros/m² and Stuttgart at 8.75 euros/m². Cologne and Hamburg (both EUR 8.50/m²) and Berlin (EUR 8.25/m²) are only marginally lower.

"The shortage of space differs significantly from region to region, with a continued lack of ESG-optimised space close to city centres in particular, resulting in fewer deals," says Schekahn. "The number of project developments, which often entail higher rents, also remains low. In addition, users prefer options that do not result in rent increases." This is also the case in Munich, where there were only a few deals in the first quarter and therefore no change in prime rents. In the other four of the five logistics strongholds (Berlin, Düsseldorf, Frankfurt, Hamburg and Munich), however, prime rents rose by 2.9 per cent or more.

"Since the beginning of the year, the inflation rate in Germany has been 2.9 per cent or lower," says Schekahn. "Due to the rent increases, logistics properties continue to be attractive investments." This can also be seen in retrospect: over the past five years, prime rents for logistics space have risen by at least 29 per cent, for example in Stuttgart. Düsseldorf, Cologne and Essen are at the top end with 67 per cent. In eleven markets, the increase was at least 50 per cent.

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 $20.8 billion and offices in more than 80 countries worldwide, our approximately 106,000 employees offer the power of a global platform combined with local expertise. Driven by our mission to shape the future of property for a better world, we help our clients, employees and society - true to our motto "SEE A BRIGHTER WAY". JLL is the brand name and a registered trademark of Jones Lang LaSalle Incorporated. All contact details and press information for JLL Germany can be found at: jll.de/press