At the end of the 2nd quarter of 2017 the letting figures for industrial, warehouse and logistics properties in Hamburg and its environs were very weak, and the exact opposite of the good 1st-quarter results. From April to June only 70,000 m² of space was let or taken up by an owner-occupier. In the 1st half year a total volume of 220,000 m² of industrial, warehouse and logistics properties were let according to figures researched by Grossmann & Berger, a member of German Property Partners
(GPP). “Thus the best first quarter was followed by the worst second quarter of the last ten years. But the overall decline in the first half year was a relatively moderate 14 per cent,” reports Felix Krumreich
, consultant for industrial, warehousing and logistics properties at Grossmann & Berger. “In 2017 there has been considerably less immediately available logistics space on the market than a year ago. In addition, it now takes appreciably longer to negotiate agreements.”
Letting market: Only one agreement for large premises
Year on year, market activity changed very little in the 2nd quarter:
Agreements: 61 agreements were signed, which translated into an overall drop in rentals of 31%, whereas the share of owner-occupiers on the market rose from 15% to 20% (45,000 m²). Apex Internationale Spedition, a forwarder, signed the biggest rental agreement of the 2nd quarter for space on the “Glinnkamp” industrial park. This mid-sized firm took some 17,100 m² of storage space and around 2,000 m² of offices (Wilhelm-Bergner-Strasse 1-11, East Environs sub-market.) The biggest contract in the 1st half year remained that signed in the 1st quarter by Hamburg State Opera for some 17,300 m² of space in the future “Neuer Huckepackbahnhof” development in the “Billebogen” (Billstrasse, Hamburg East). From 2018 the opera house intends to house costumes, scenery and workshops in the premises.
Take-up of space by size categories: The fifteen contracts signed in the two biggest size segments together accounted for a good two-thirds of take-up (146,000 m²). In the same quarter a year earlier these categories posted a total of 51% of take-up. Year on year fewer agreements were signed in the category 5,001 m² or more; here the total fell from fifteen to ten, whereas the number of agreements for more than 10,001 m² soared from one to five.
Rents: A slight increase in the gap between premium and average rents was noted compared with the prior year. Whereas the premium rent climbed ten cents to €5.80/m²/month, the average rent remained at a stable €4.80/m²/month.
Take-up of space by industry: As in the same quarter a year before the logistics/forwarding sector accounted for 47% of total take-up of industrial, warehouse and logistics space in Hamburg and its environs (102,300 m²). “Nine of the fifteen biggest agreements for more than 5,001 square metres were signed by logistics companies,” remarks Krumreich. The biggest new rental contract signed by a logistics company was the 8,000 m² taken in the 2nd quarter by a specialist for tyre logistics in the Billbrook district (Hamburg East). The retail/trade and industrial/skilled trades sectors took practically unchanged shares of the total, accounting for 26% (up from 23%) and 18% (up from 14%). A furniture retailer accounted for retail’s biggest 2nd-quarter lease with 5,000 m² of hall space and 500 m² of offices in the district of Tonndorf (Hamburg North East). “The company is planning to locate a warehouse here from which it can supply its four furniture discounters in Hamburg, in particular the store in Wandsbek,” says Krumreich.
Take-up of space by sub-markets: Year on year there was very little change in the way that take-up of space was divided between the sub-markets. Since four of the agreements for more than 5,001 m² were concluded in Hamburg East and five in South West Environs, these two sub-markets again took the highest and second-highest shares of the market, at 29% and 23% respectively. Nor was there much change in the way take-up was split between the areas inside and outside city borders, with 55% for the city and 45% in the environs.
“Because there are several new build developments in the southern part of Hamburg Port in the pipeline, we expect to see stable letting activity in the second half year, although it will not be as high as last year, when a new record was set. Overall, the annual take-up of industrial, warehouse and logistics premises in Hamburg and its environs is likely to be somewhere between 450,000 and 500,000 square metres,” predicts Krumreich
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