Logistics

The warehouse and logistics sector has emerged as a standout segment in 2024, driven by significant structural trends reshaping the market. While demand for logistics space has remained strong, large-scale lease contracts have been limited. Combined with constrained new supply, this has contributed to stable rent levels throughout the year.

Transaction Market

Geopolitical uncertainty and the continued expansion of e-commerce have reinforced investor confidence in logistics assets, underpinned by expectations of a more resilient rental market. Investor demand for logistics properties has intensified significantly in 2024, as reflected in transaction volumes, which are now more than 30 percent above the 10-year historical average. Furthermore, logistics assets accounted for an unprecedented 26 percent of total transaction volume in 2024, markedly exceeding the 10-year average of 14 percent. Prime yield for logistics and warehouse assets has remained stable since the last repricing in Q4 2023, currently standing at 5.75 percent.

Photo: Fredrik Hansson

Logistics rent, large and small warehouses

Rental Market

Leasing activity within the logistics sector was subdued in the first half of 2024 but gained momentum in the latter half despite broader macroeconomic headwinds. Key demand drivers include the sustained expansion of e-commerce, corporate consolidations, an increasing focus on sustainability and energy efficiency, and the need to secure supply chain resilience in response to geopolitical risks. However, we have also observed a shift among certain occupiers towards leaner inventory management, with a return to Just-in-Time supply strategies aimed at cost optimisation.

Rent levels have stabilised across most established logistics hubs following a period of rapid growth. The scarcity of available prime logistics space has led to supply constraints, forcing some occupiers to explore locations further from core urban areas. This, coupled with rising construction costs, has contributed to moderate rental growth in secondary logistics locations during the second half of the year. Prime rents at Berger and Langhus remain unchanged at NOK 1,700 per square meter, while prime assets at Alnabru are holding steady at NOK 2,000 per square metre. Last-mile logistics facilities in near-urban locations continue to command rents of NOK 2,200 per square meter as of Q4 2024.

Photo: Adobe Stock

Logistics prime yield, percentage

Key figures

Outlook

Macroeconomic conditions, both in Norway and internationally, have proven more resilient in 2024 than initially anticipated, supporting stronger than expected consumer spending. With diminishing economic uncertainty and the prospect of interest rate cuts, goods consumption is expected to strengthen further. Given the continued supply-demand imbalance and sustained investor interest in the sector, rental growth is projected to persist across prime logistics locations. Investor appetite for Norwegian logistics assets remains robust and is expected to continue, driven by both domestic and international capital.