Take-up of space in industrial, warehousing and logistics properties in Hamburg and the environs totalled some 665,000 m² at the close of 2016. This emerges from figures released by Grossmann & Berger. They represent a 13% increase on 2015, which was already a very good year. “This was the second-highest result ever posted in Hamburg, topped only in 2011, when take-up totalled 740,000 square metres,” says Stefan Harder
, head of the industrial, warehousing and logistics properties division at Grossmann & Berger. “The fourth quarter made all the difference; our figures show that take-up was 265,000 square metres, higher than in any other quarter before. Moreover, seven of a total of twelve contracts for over 10,000 square metres were concluded in the fourth quarter.” Owner-occupiers accounted for only 18% of the total, compared with 28% the year before.
Letting market: 7 agreements account for half of all space taken up
Logistics/industrial property investments: collapse in transaction volume
Completions: Compared with 2015 the number of rental agreements and owner-occupier contracts fell by 18%, from 190 to 155. The biggest agreement completed in the 4th quarter, indeed in the whole of 2016, was Amazon’s rental of 64,000 m² of space in the “Logistikpark Hamburg 1” to create a new logistics centre (Borgwardstrasse 10, South-East environs). The second-biggest transaction of the year was the construction start for food discounter Netto, which is building a 35,000 m² logistics and warehousing centre plus 3,000 m² of office space in Henstedt-Ulzburg (Heideweg, North West Environs). The third-biggest transaction of the year, likewise signed in the 4th quarter, was van Eupen Logistik’s rental agreement for 26,900 m² of hall space at the Altenwerder port terminal, plus 1,700 m² of office space (Am Altenwerder Kirchtal 1-3, Hamburg South).
Take-up of space by size categories: Almost half of the take-up of space (49%) involved premises offering over 10,001 m²; this size category grew by a huge 91%. The next most popular categories were the two mid-sized segments, from 5,001 to 10,000 m² and from 3,001 to 5,000 m², which accounted for 20% and 15% of take-up of space.
Rents: 2016 closed with average rents for industrial, warehousing and logistics space in Hamburg standing unchanged at €4.80/m²/month. The premium rent, by contrast, climbed ten cents to €5.80/m²/month.
Take-up of space by industry: Since eleven of the twelve agreements in 2016 for over 10,001 m² of space were signed by companies in the trade/retail and logistics/haulage sectors, this section of industry dominated take-up, as it had in 2015. The lion’s share was taken by trade/retail, which posted 44% of the total including five big-scale agreements. Logistics/haulage companies were responsible for six large transactions and a 36% share of space taken up. Manufacturing/industry/trades&crafts accounted for 12% of total take-up and one of the large-sized agreements. This transaction was the rental of 15,170 m² of hall space and 875 m² of office space on an industrial estate in Elmenhorst, agreed in the 4th quarter with a Hamburg company in the data processing services sector (Irwin-Helford-Strasse 2, East Environs).
Take-up of space by sub-markets: 57% of the space newly taken up was located in the environs of Hamburg, which tenants and owner-occupiers slightly favoured over sites within city limits. At the close of 2015 some 70% of demand was concentrated on the areas within Hamburg city limits. The most popular sub-markets were Hamburg East and South East Environs, each with 20% of the market. Essentially this was due to the Amazon contract for a very large amount of space in the South East Environs that was already mentioned, and to three big agreements in Hamburg East totalling 43,000 m². Hamburg South and North West Environs registered 18% and 15% of total take-up respectively, thanks to the third and second-biggest agreements that were noted earlier. Part of the high level of take-up in the North West Environs was due to Tramaco, a specialist firm for chemical foaming agents and adhesion promoters, which bought premises in Tornesch (Lise-Meitner-Allee 8) for its own use. A contract was signed for some 5,700 m² of industrial space and 1,100 m² of offices.
At the close of 2016 investors had spent €154m on logistics and industrial properties in Hamburg and the environs. Year on year, the volume of transactions plummeted by about 57%. The net prime yield for logistics and industrial properties continued its downward spiral, ending at 4.90% or 50 basis points below the figure seen a year ago.
Outlook for the letting market
In the second half of 2016 the last remaining available large sites in Winsen and Hamburg-Neuland were let to Amazon and DP DHL, and the result is an even more acute shortage of commercial building land inside Hamburg city limits and in the surrounding districts. In core locations, there are still some building lots sized between 20,000 and 30,000 m² available. “We don’t expect to see any commercial sites inside Hamburg that will accommodate large developments until 2019 or later. Therefore developers and owner-occupiers are now taking a closer look at brownfield sites,” remarks Harder
. “Buoyed by the positive trends on the market, some developers are intending to erect new build projects that are partly speculative. Due to the big development that DP DHL plans in Hamburg-Neuland, with construction projected to begin in the second half of the year, we forecast take-up of between 575,000 and 600,000 square metres for the year 2017.”
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Graphic source: Grossmann & Berger GmbH