Net prime yields of warehouses over 5,000 square meters in Europe 2023, by market
The major markets in Germany had warehouse yields of under 4.5 percent as of the fourth quarter of 2023 - the lowest across the European cities in the ranking. Other markets with low yields were London, Paris, and Marseille. In real estate, yield is a measure of the rate of return and is calculated as the ratio of the annual income to the total investment cost.
How have yields developed in recent years?
As a function of income and costs, many political and market factors can contribute to yield fluctuation. Prime warehouse yields followed a downward trend for several years in a row, reflecting a growing demand and property values. In 2022 and 2023, property values declined amid a slowdown in the investment market. As a result, yields increased.
Investment in industrial and logistics real estate
In 2022, commercial real estate investment in Europe fell by 12 percent, with negative growth in almost all counties. After a strong 2021, the industrial and logistics real estate sector also saw a decline in investment. Though investment volumes fell in most countries, a few followed the opposite trend.
