Warehouse Rents Increased 10% in Average in Prime Logistics Areas of Lisbon and Porto
The take-up of warehouse and logistics spaces in Greater Lisbon increased 10% in 2016, according to CBRE’s recent study. According to the “Property Perspective” study, the scarcity of quality logistics warehouse led to an average increase of 10% of prime rents in two of the main cities in the country.
In 2016, the take-up of warehouse and logistics spaces in Greater Lisbon has reached a total of 146,000 sq m, with 35 deals, an area 10% above of what was registered in 2015 but still below the average of the last 10 years. The space transacted in the second semester was 50% lower than that recorded in the first half of the year, with only 49,000 sq m and 15 deals.
This take-up reflects a market where there were no new developments, the entry of new operators is not expressive and major distribution companies have been accommodating expansion needs in the spaces that they already occupy.
In the end of 2016, prime rents in Carregado – Azambuja suffered an 8% increase year-on-year, standing at 3, 5€/sq m/month for logistics warehouse of 10,000 sq m. On the other hand, high demand of industrial and logistics spaces in the south bank of the Tagus river, led to a decrease of prime rent values, which stood in the last quarter at 2,75€/sq m/month.
In Porto, rental values also increased, 8% in the prime zone of Maia and 14% (the biggest annual increase) in the Airport area.
New built-to-suit developments are expected
According to CBRE, the construction of logistics warehouses in Lisboa-Norte Logistics Platform, in Castanheira do Ribatejo, should finally start. This project, with a potential development of 430,00 sq m of gross construction area, is expected to gain a new impetus after being acquired by Merlin in 2016 and with the recent announcement that the food distribution chain Jerónimo Martins intends to develop, in several plots of the project, a platform to install a meat processing and distribution unit.
Also the Spanish food distribution chain Mercadona announced the expansion to Portugal of the supermarket chain, with the opening in 2019 of the first units in the country and, therefore, the construction of its logistics platform in the outskirts of Porto is expected to start this year. In fact, also in Greater Porto, the supply of good quality products remains equally scarce, driving demand for tailor-made projects, such as ID Logistics, Schenker and Jerónimo Martins platforms are examples of.