Realogis report highlights Stuttgart real estate market success in H1 2020
The Stuttgart logistics and industrial properties market generated a solid result in the first half of 2020, with a letting performance of 84,600 sq m brokered by all market participants combined.
According to Realogis – the leading consulting firm for industrial and logistics properties and business parks in Germany, with 70 experts – this is 6 per cent higher than the five-year average (79,880 sq m) and represents the third-best result in the last five years (H1 2019: 94,400 sq m, H1 2018: 85,000 sq m). Only the results in H1 2016 (59,000 sq m) and H1 2017 (76,400 sq m) were weaker. As expected, existing properties accounted for 92 per cent (77,800 sq m) of total take-up, with just 8 per cent (6,800 sq m) let in the new-build segment.
Nonetheless, the current half-year result in the Stuttgart economic region is 10 per cent below the previous year’s level. “We were already seeing declining demand in the third and fourth quarters of 2019 in connection with faltering industry. Now, the situation may become even more severe as the muted demand that set in in 2019 due to the economic downturn is also being exacerbated by the uncertainty resulting from the coronavirus pandemic,” says Adriano Borgia, Managing Director of Realogis Immobilien Stuttgart GmbH.
Despite this, Borgia is optimistic and confident about the future as other sectors are enjoying massive growth: “Unfortunately, we will have to say goodbye to some of our key industries as these are no longer competitive by international standards or some of the products are obsolete. This is why it is important to address the changes head on and support other growing sectors such as e-commerce companies.”