Italian Logistics Snapshot | Q4 2022

Key takeaways:

• Logistics remains an attractive asset class despite soft Q4
  The logistics sector remains an attractive asset class, but global geopolitical uncertainty may temper investment activity, especially in the first half of the year. Pressure on prime yields may start to cool down but financing costs continue to weigh-in on investment decisions.

• Logistics take-up driven by 3PL demand
  Italian logistics occupiers market remained robust in 2022 with a new record in terms of take–up, which increased by 13% YoY. The demand was driven by grade A assets and by 3PLs operators. Rental growth was recorded in the main Italian logistics markets.

The Italian economy held up surprisingly well in 2022 despite high global uncertainty and rising energy prices: carry-over annual GDP growth now stands at +3.9%.

From a capital markets standpoint, the first three quarters of 2022 have confirmed the strong interest of Investors in the Italian logistics sector, driven by strong demand and a tight supply-demand dynamic, although rising inflation, interest rates and tighter monetary policy have hindered activity in Q4 in Italy as in other EMEA markets.

Logistics leasing increased in take-up: another record year

In 2022, logistics take-up in Italy totalled around 2.8 million sqm, +14% YoY and +73% on the 10-years average. While consolidated markets continue to represent the largest share of the overall gross absorption, the importance of other markets remains significant compared to before 2020.

This is reflective of a growing trend with tenants looking beyond established logistics hubs and markets as they on one hand streamline and on the other expand their supply chains to serve their growing business and consumer customer base.