Economic outlook and its impact on logistics
The industrial and logistics sector has solidified its position as one of the most attractive for investors in recent years. In 2024, this sector has experienced significant growth compared to the previous year, drawing the interest of investors and companies looking to seize its opportunities. According to data collected by Colliers, investment in this sector reached €461 million in the third quarter of this year, marking an uptick that demonstrates the sector’s stability.
This growth confirms an upward trend particularly evident over the past year, with a total of €1.11 billion in the industrial and logistics sector, an 87.9% increase compared to the same period last year. In this article, we analyze the factors driving this growth.
Expansion of logistics demand
Demand for logistics spaces in Spain continues to show high absorption levels, with the Central Zone and Catalonia leading the way in leasing activity. In the third quarter of 2024, the Central Zone recorded an absorption of 202,000 m², reaching a total of 680,000 m² leased by September. Catalonia, on the other hand, experienced its best leasing performance in the past seven quarters, with 253,000 m² in the same period, while Valencia maintained steady levels compared to the previous quarter, reaching 51,000 m² and a vacancy rate below 2%.
These figures highlight a stable trend in space leasing, supported by sustained demand over time. Additionally, availability in these areas remains quite low overall, reinforcing the sector’s ability to attract investment, especially in a context where logistics remains essential for trade and distribution across Europe.
Investment attractiveness and rent trends
In terms of investment, the logistics sector maintained high levels of activity in 2024. Although rents stabilized this quarter after increases earlier in the year, forecasts indicate a renewed upward trend in the coming months due to continued demand growth and limited supply in key markets, particularly Madrid and Barcelona.
This is compounded by the interest of investors seeking diversification and profitability in an investment environment where returns on other assets, such as sovereign bonds, have declined. Against this backdrop, the logistics sector stands out as an attractive option, not only for its rental growth potential but also for its stable long-term demand.
Economic outlook and Its impact on logistics
According to Colliers, Madrid, Barcelona, and Valencia have been the standout areas for logistics investment in 2024, attracting over 90% of transactions in the third quarter. Madrid emerged as the leading city, capturing 67% of total investment (€311 million) during the quarter. Meanwhile, Barcelona and Valencia each secured 13% of the total, with €60 million and €62 million, respectively.
Macroeconomic conditions in Europe and the United States also influence the dynamics of this sector. The recent monetary policy decisions by the European Central Bank and the U.S. Federal Reserve to gradually reduce interest rates have benefited investment in logistics assets by lowering financing costs and raising return expectations. In the eurozone, the benchmark rate has been reduced to 3.65%, while in the U.S., rates stand at 5%. These rate cuts have positively impacted the logistics sector, enabling more investors to finance logistics acquisitions and helping high-demand logistics assets remain a solid investment over time.
Additionally, with more controlled inflation in Spain, lower interest rate forecasts and reduced financial costs benefit investor interest in logistics. This translates into higher stability and growth potential for the sector in the coming years, especially in a context where demand remains strong and the supply of new developments is limited in high-value locations.
Conclusion
The logistics sector in Spain continues to stand out in 2024 as a solid investment opportunity, driven by strong demand for spaces and a strategic location within Europe. Rent stabilization, along with favorable economic conditions, reinforces the idea that the industrial and logistics sector will continue to grow in the coming years.
The outlook indicates that with increasing demand and limited supply, the sector’s appeal will not only persist but may even expand, particularly if monetary policies maintain their downward trend in interest rates. As such, this sector represents a strategic bet for investors seeking to diversify their portfolios with assets in a stabilized sector and one of the most promising areas of today’s real estate market.