Italian Logistics Snapshot | Q1 2023

Key takeaways:

The Italian economy is expected to grow by 0.6% in 2023 | The Italian economy contracted by -0.1% in Q4 2022. A positive contribution came from foreign trade and an acceleration in gross fixed capital formation, while consumption and inventories were the key negative drivers. This is mainly due to the impact of high inflation, which ultimately eroded households purchasing power. Having said that, latest market consensus projections indicate an average GDP growth of 0.6% in 2023.

Logistics first in terms of investment volumes in Q1 2023 | In Q1 2023 logistics became the first asset class for Italian Capital Markets. Even if global geopolitical uncertainty tempered investment activity YoY, volumes are above the last 5 years Q1 average. Pressure on prime yields may start to cool down but financing costs continue to weigh-in on investment decisions in H1 2023.

Logistics take-up driven by 3PL demand | The Italian logistics occupiers market remained robust in Q1 2023, above the 3 years Q1 average, despite a -7% YoY variation. The demand was driven by grade A assets and by 3PLs operators. Rental growth was recorded in the main Italian logistics markets.