LIP Invest, a specialized real estate fund for logistics properties, has released its market report "Lip up to Date - Logistics Real Estate Germany" for the second quarter of 2025. The report contains data on the development of transaction volumes, space turnover, new construction activity, yields, and the interest rate and market situation. It also provides an outlook for the third quarter.
Investment Market and Interest Rate Environment
According to a press release from the company, around 1.4 billion euros were invested in German logistics properties in the second quarter. The transaction volume for the first half of the year was a total of 2.6 billion euros, slightly below the previous year's period. The background is the absence
of larger portfolio transactions and longer transaction periods. The prime yield (BAR) for new buildings increased to 4.9 to 5.1 percent in the second quarter. The ten-year swap slightly increased. According to LIP, the high surcharges from some banks continue to impact financing costs.
Interest Rates from an Investor's Perspective
Sebastian Betz, managing partner of LIP Invest, identifies high margins and surcharges in financing as a burden factor. These have recently acted as a buying brake. The short-term interest rate cuts by the ECB would mainly benefit project developers so far. However, long-term interest rates remained significantly elevated and volatile. According to Betz, interest conditions between 3.6 and 3.8 percent for a ten-year term are sustainable.
Supply Situation
In the second quarter of 2025, LIP identified a supply volume of around 1.3 billion euros. The product supply has steadily increased in recent months. According to the report, this creates good conditions for transaction activity in the third quarter.
Space Turnover and User Structure
Space turnover in the second quarter was 1.4 million square meters. In the first half of the year, around 2.6 million square meters were rented or newly constructed. While some logisticians rely on existing stock, others are acting expansively. Chinese companies are increasingly appearing as direct tenants. For example, SK Express Germany rented 40,000 square meters in Greven and manages a total of 68,000 square meters in North Rhine-Westphalia.
New Construction Activity
New
construction activity in the second quarter amounted to around 800,000 square meters. In total, 1.55 million square meters of new logistics space were constructed in the first half of the year. In Lübeck, Panattoni began constructing a 46,000-square-meter logistics property, most of which is rented to Dräger. In Florstadt, DHL opened a 30,000-square-meter logistics property for pharmaceuticals and medical products.
Trends in the CEP Segment
According to the Federal Association for Package and Express Logistics (BPEX), the CEP market continues to grow. The shipment volume could exceed five billion by 2029. Direct imports in e-commerce are increasingly shifting towards local fulfillment. In regions like North Rhine-Westphalia and Bremen, this creates additional demand for fulfillment and distribution centers. (sv)
