Sunday, 1 February 2026
European logistics real estate markets are expected to experience muted momentum over the coming years, with selective growth concentrated in established core locations, according to the latest GARBE PYRAMID MAP published by GARBE Research in cooperation with Oxford Economics.
The forecast, which covers 88 of 122 logistics regions across Europe, reflects a more volatile economic and geopolitical environment and the absence of strong cyclical growth drivers. While average annual prime rent growth reached 5.7% between Q4 2020 and Q4 2025, the outlook for the next five years points to a significantly slower pace of around 1.9% per year.
On the yield side, the report indicates a stabilisation phase following the market correction that began in 2022. Average prime yields across the analysed regions increased from 4.6% in mid-2022 to 5.7%, but recent quarters suggest a gradual return towards yield compression. By 2030, average prime yields across the forecast markets are expected to decline moderately to around 5.2%, with most regions seeing slight compression and others remaining broadly stable.
According to GARBE, logistics real estate markets are increasingly decoupling from immediate geopolitical developments. While global events continue to shape sentiment, their direct impact on market performance has become less immediate and more uneven across regions.
Tobias Kassner, Head of Research & ESG at GARBE Industrial, noted that market participants are gradually adjusting to ongoing uncertainty and resuming activity after several years of correction. He added that future performance will be driven less by cyclical recovery and more by location-specific fundamentals.
In this environment, operational performance and asset management have become more critical. Tom Herrschaft, Head of Real Estate Management at GARBE Industrial, emphasised the importance of stable cash flows, active lease and tenant management, and close control at both asset and portfolio level.
Despite the overall slowdown, the forecast identifies continued growth potential in a number of European logistics markets. Prime rents are expected to increase by more than 10% by 2030 in 45 regions, mainly in established core markets in Germany, the United Kingdom, France and the Netherlands.
Munich stands out as a particularly strong performer, supported by sustained demand, limited supply and a robust regional economy. In general, the most attractive return profiles are expected in liquid core markets where moderate rental growth is combined with stable yields.
In the United Kingdom, logistics markets continue to show resilience despite ongoing consolidation. Demand remains strong in established regions such as the Midlands and North West England, supported by interest from Asian e-commerce players, defence-related industries and aviation. Limited availability of modern space continues to support rental levels, particularly in well-connected locations near ports.
The French logistics market has also demonstrated stability, with demand driven by both physical retail and e-commerce. Additional support comes from defence and aviation activities, notably in regions such as Toulouse. Investor and occupier focus is increasingly shifting towards modern, ESG-compliant assets, while vacancy remains concentrated in older stock, particularly in northern France.
GARBE’s analysis concludes that longer-term structural trends are likely to continue shaping Europe’s logistics real estate markets. E-commerce, reconfiguration of supply chains, increased regionalisation of production and a growing focus on strategic resilience and defence-related industries are expected to provide ongoing, though selective, demand impulses across borders over the coming decade.
For more detailed statistics and methodological information, see the interactive GARBE PYRAMID MAP.
