2015 was an exceptional year for the logistics sector in Spain (€662 million was invested) and this positive trend seems to continue into 2016 (Q1 in 2016: €320 million invested). The positive performance of consumption and industrial output, which began three years ago, has boosted the logistics market in 2015 and so far in 2016. Moreover, the shortage of high quality product has led to a slight increase in rents and above all to a stabilisation of prices.
It is worth highlighting two key milestones that are shaping the evolution of the logistics real estate sector and boosting the strong outlook for this sector.
On the one hand, 2014 and 2015 were the years when the highest ever investments were made in logistics warehouses. The market saw a generational change in owners with the disappearance of some and the appearance of others. The latter group includes international investors, which have been positioning themselves in the market, including several specialists, such as Prologis, which have strengthened their position in Spain; and the Socimis (Spanish REITs) which have secured capital from overseas and invested it in this segment to create significant portfolios of logistics warehouses. During the first quarter of 2016, the main Socimis and funds interested in logistics assets invested around €320 million.
On the other hand, consumer habits have changed with the crisis, which has led to a very significant increase in the volume of consumer purchases made online, to the detriment of in-store shopping. In this respect, e-commerce is growing at an average rate of 20% p.a.. To the extent that the volume of purchases made online increases, so too does demand for logistics spaces designed to provide support for these types of businesses. In 2015, around 17,000 sqm of logistics space was leased for e-commerce use. Even so, in Spain, online shopping accounts for just 3% of overall consumption, which reflects the potential for growth in the country, above all if we compare it with other markets such as Germany and the UK, where e-commerce accounts for 10% and 13.5% of all shopping, respectively.
During 2016, consumption is expected to continue to grow with the same energy, along with the leasing of logistics space. Income will continue to increase and yields will continue to decrease due to the shortage of high quality logistics products. The e-commerce business will grow and so too will demand for cross-docking and XXL warehouses. The main Socimis and funds will continue to expand their portfolios with logistics assets.