. “A transaction volume of more than 1.1 billion euros signifies a year-on-year increase of 69 percent and a share of the entire market transaction volume at 8.5 percent above last year’s average,” Peter Kunz (FRICS), Head of Industrial & Logistics at Colliers International Germany, points out. As we have come to expect, the market share for package sales and international investors is once again considerably higher than that of the commercial investment market in Germany. A total of around €438 million, or 40%, of invested capital went into logistics portfolios during the first six months of the year. During the same period of time, international investors made purchases totaling approx. €411 million, or a market share of 37%.

Broad, low-risk buyer spectrum
Most of the capital invested in logistics and commercial real estate properties came from open-ended real estate funds and special funds. €319 million is the equivalent of a 29% market share. However, other investor groups, primarily with a low-risk profile, played an important role as well. Asset managers invested around €210 million (market share of 19%), corporates and owner-occupiers €154 million (14%), private investors and family offices €115 million (10%) and project developers €114 million (10%). “The number of high-risk investors active on the market was rather low, but they’re still keeping their eyes peeled for attractive investment opportunities,” Peter Kunz says. Open-ended real estate funds and special funds were the most active buyers and sellers on the market. They sold logistics properties in the amount of around €325 million, putting them considerably ahead of corporates and occupiers with a volume of €269 million and project developers at €247 million.

Investor focus on high-quality portfolio properties – prime products remain expensive
Between January and June, investments in portfolio properties made up the largest share (87%) of total transaction volume at around € 962 million. New buildings and project developments only recorded a transaction volume of around €145 million. “This was primarily due to the low supply of new buildings and projects. However, there are a number of portfolio properties that meet the highest user demands and that were built relatively recently. The fact that these properties can usually be used by third parties and boast long-term lease agreements puts them in the highly coveted class-A property category,” states Andreas Trumpp, Head of Research at Colliers International Germany. The current market situation shows that investors are still focusing on densely populated areas and established logistics locations. In the six cities surveyed, prime yields for prime logistics properties continued to remain at the low level that we have been seeing for some time. The most expensive locations continue to be Frankfurt am Main and Munich, each with top yields of 6.90%, followed by Hamburg and Stuttgart, each with 7.20%, Dusseldorf with 7.25% and Berlin with 7.30%.

Outlook: Market activity to remain lively
As expected, German logistics and industrial properties were an attractive investment target for national and international investors in Q2 as well. “We expect a number of large-volume sales on the market for value-added products in the coming months,” Peter Kunz says. He adds, “Despite this trend, we’ll continue to see primarily security-driven demand, leading to continuing high prices and low yields.” Since there are some medium-sized individual sales and a number of large-volume package sales in the pipeline, which are expected to be finalized in the second half of the year, we believe that the transaction volume in the second half of the year will be comparable to the one we saw in the first half. “That would translate into an annual result of more than 2 billion euros, which we find realistic,” Mr. Kunz concludes.