Rental rates for prime logistics space are rising throughout the world, and in some markets, ballooning.
The bump in rates is being driven by strong national and regional economies, but especially by e-commerce as consumers demand faster service when ordering online, CBRE reports.
Prime logistics rents — rates for top-quality warehouse and distribution space — were up an average of 3.2% across the world during Q1 2018 compared with a year earlier, according to the report. The previous 12-month period, Q1 2017 compared with a year earlier, saw an increase of 2.2%.
“In the Americas, supply chain and e-commerce dynamics have fueled rent growth at different rates across the region,” the report said. “The U.S. and Canada have led the way, with users aggressively leasing space in response to both persistent economic and structural shifts brought about by e-commerce.”
In the Americas, prime rents were up 3.8% year over year as of Q1 2018, about the same as the year before. Demand continues to outpace supply, with net absorption 9.9% higher than deliveries in Q1 and 20M SF worth of space absorbed, CBRE reports.