While take-up had been 22% below the five-year average in 2019, and 16% down in 2020 (578,800 m² and 584,660 m²), in 2021 it was 10% higher again for the first time at 596,000 m².

Realogis registered 113 deals in total by all market participants between January and December 2021. The high number of major deals was a highlight, and the top five deals alone contributed 189,400 m² or 28.9% to total annual take-up.

New players in user groups and changing parameters for properties

“We had a lot of very similar requests from different food delivery services in 2021. The requests themselves were not unexpected given the pandemic, but their sheer number and their presence as new market participants in this segment surprised even us,” reports Adriano Borgia, Managing Director of Realogis Immobilien Frankfurt GmbH.

This also entails some changes to the parameters for top new logistics buildings. “Loading ramps and parking spaces, or open areas, are becoming increasingly important and are in high demand. Express and food delivery services rely on a high volume of fast transport, and property developers are responding to that,” says Adriano Borgia. “As this use is not optimal for developers and owners, we expect to see rents rise for these properties moving ahead.”

Rhine-Main East sub-market riding high
The biggest region by take-up in 2021 was Rhine-Main East at 261,500 m² or 40%. This region also took the title for fastest rise among all market areas with growth of 9.1 percentage points (2020: 152,200 m² or 30.9%). Four of the top five lessors in terms of take-up – the Hager Group, ID Logistics, PepsiCo Deutschland and B+S – are located here (157,400 m² or 60% of take-up in Rhine-Main East).

Second place goes to last year’s number one, the Rhine-Main South region with 254,500 m² or 38.8%, the biggest faller for take-up in 2021 at 7.9 percentage points (2020: 230,000 m², 46.7%).

The third-biggest region is central Frankfurt with take-up of 48,600 m² or 7.4% of total volume. Central Frankfurt thus more than doubled its absolute take-up and rose by 2.7 percentage points (2020: 23,200 m² or 4.7%).

Rhine-Main North, where the biggest transaction was with DHL for 32,000 m² in Florstadt, accounts for 44,900 m² or 6.8% (up 2.4 percentage points; 2020: 21,800 m² or 4.4%). Rhine-Main West chalked up 34,900 m² or 5.3%, equivalent to a drop of 5.8 percentage points as against the previous year (2020: 54,600 m² or 11.1%). Like last year, last place goes to the Mainz/Wiesbaden sub-market with 11,400 m² or 1.7% (down 0.4%; 2020: 10,500 m² or 2.1%).

Logistics/distribution using one in two square metres

Second place in 2020, the logistics/distribution sector accounted for take-up of 327,800 m² or 50% in 2021 – half of all square metres newly occupied. In absolute terms, this sector’s result has virtually tripled and it also had the highest growth in market share at 28.1 percentage points, coming from 21.9% or 108,000 m² in 2020. The sector is the deal leader as well, claiming four of the top five. Together they account for 149,400 m² or 45.6% of the sector’s take-up and make a significant contribution to its good performance.

In second place is retail, down from number one with a share of 39% or 255,800 m². While it improved slightly in absolute figures, retail slipped 8.8 percentage points in significance year-on-year, coming from 47.8% or 235,200 m². This segment landed one of the top deals with 40,000 m² in a new property in Hammersbach (Hager Group).

Retail is followed by the “Miscellaneous” category at 6.8% or 44,800 m² (down 3.5 percentage points; 2020: 51,100 m² or 10.4%) and – the biggest faller from last year – manufacturing, down by 15.7 percentage points from third place (4.2% or 27,300 m²; 2020: 19.9% or 98,000 m²). After accounting for almost one in five square metres in 2020, in 2021 it took only around one in 25 with an absolute slump in take-up of approximately 72%.

Approximately 75% of all space relates to areas of 5,000 m² and up
The trend towards large areas continued in 2021. Areas of 5,000 m² and up were an easy winner in 2021 with a share of 74.4%. This category had ranked first in the previous year as well, with a share of 68.9% or 339,400 m², and this year had the highest growth among all size segments (5.5 percentage points). 30 of the 113 deals on record were in this category (27%), including all of the top five transactions, which together contribute 189,400 m² in total (or 38.8% of the take-up in this size class).

The 3,001 to 5,000 m² group accounted for an area of 70,100 m² or 10.7% in 2021, down 3.4 percentage points year-on-year (2020: 69,300 m² or 14.1%). This category had 18 deals (16%).

The segment between 1,001 and 3,000 m² had the highest number of contracts in 2021 at 45 (40%), and took second place with an area of 84,100 m² or 12.8% (down 2.0 percentage points; 2020: 73,200 m² or 14.9%). There were 20 deals for small areas of less than 1,000 m² (18% of all transactions) for a cumulative total of 13,700 m² or 2.1% of all space.

Prime and average rents reach record highs
According to Realogis, prime rents for industrial and logistics properties in the greater Frankfurt/Main area climbed by 1.4% to a provisional high of EUR 7.10/m² in 2021, an increase of slightly more than 1.4%. At the same time, this is 4.7% higher than the five-year average of EUR 6.78/m².

Average rents rose to a new provisional high of EUR 5.25/m². The increase of 6%, up from EUR 4.95/m² in 2020, marks the fastest rise in the past five years. After virtually matching the five-year average of EUR 4.91/m² in the previous year, average rents are now 5% higher than the five-year average of currently EUR 5.00/m².

Average and prime rents have recently grown closer: At the end of 2020 the gap between prime and average rents in the greater Frankfurt area was still EUR 2.05/m², compared to EUR 1.85/m² at the end of 2021.

Price increases anticipated for sustainable properties in Rhine-Main area
“For years now, high-quality logistics properties have mostly been built to DGNB silver or gold standard. With prime rents of EUR 7.50/m², an even higher platinum sustainability certificate would mean another price hike,” explains Adriano Borgia. “We assume that tenants will increasingly become interested in sustainable building concepts and that they will therefore become more willing to pay higher rents. Ultimately this means value added for both sides.”

“More and more attention is being paid to ESG factors when searching for the right properties,” adds Julian Petri. “We are mainly seeing this among larger companies and corporations. However, we can well imagine that ESG criteria will play an ever greater role for smaller businesses as well.”

Charts: To improve clarity, the charts prepared and used by Realogis contain rounded figures, but are based on the exact figures used in the text.

Copyright to charts: Charts can be reproduced free of charge citing the source “REALOGIS”.

REALOGIS press contact:

SH/Communication – Public Relations Agency

Silke Westermann

Press

Fritz-Vomfelde-Strasse 34, 40547 Düsseldorf

Tel: +49/211/53 88 3-440

e-mail: s.westermann@shcommunication.de

REALOGIS company contact:

REALOGIS Holding GmbH

Silja Schuppler

Marketing

Rundfunkplatz 4, 80335 Munich

Tel: +49/89/51 55 69 17

e-mail: s.schuppler@realogis.de

www.realogis.de

REALOGIS. No. 1 for industrial and logistics properties

The REALOGIS Group is Germany’s leading player for the consulting and brokering of industrial, logistics and commercial properties. Founded in 2005 as a pioneer for the asset class of logistics and industry, the owner-operated group has enjoyed healthy growth, is crisis-resistant and knows the German market like no other. With over 1 million m² of usable space and audited net commission revenue of EUR 13.9 million in the 2020 financial year, REALOGIS reported twice the revenue and lead over the runner-up in 2020.

In 2021, REALOGIS also won the German Real Estate Prize in the “Commercial Player” category, which honours companies for their outstanding commitment, creativity, innovative strength and sustainability.

Realogis is represented in the country’s seven top logistics locations of Berlin, Düsseldorf, Frankfurt am Main, Hamburg, Leipzig, Munich and Stuttgart, while a dedicated organisational unit ensures transparency in around 15 additional regional logistics markets. 70 real estate professionals advise national and international companies from the fields of logistics, e-commerce, retail and industry as well as private and institutional investors. Quick, flexible, regional, customer-oriented and with a high volume of transactions.

REALOGIS four core competencies are arranging highly creditworthy tenants for new and existing properties, assisting investors with property investments and project development of greenfields and brownfields, outstanding service for locating or selling sites, and the development and implementation of holistic property strategies.

In short, REALOGIS creates more room for its customers’ success in every sense. Further information: https://www.realogis.de/