Prologis Europe shares its results for the fourth quarter and full year 2023. This summary includes the main operational key figures and some significant achievements and milestones.
Ben Bannatyne, President, Prologis Europe:
“We closed the fourth quarter of 2023 with a solid pipeline, a healthy uptick in development and vacancy levels well below market average. Given current conditions, demand for quality and sustainable warehouse space remains strong, particularly in dense markets like the UK, the Netherlands and Germany. Across all European markets we continue to be focused on our customers success, providing solutions through our industry-leading Prologis Essentials platform, strategic landbank and the best team in the business.”
Operating Performance – Fourth Quarter and Full Year 2023:
- Total portfolio: 22.5 million square metres*
- Fourth quarter total leasing activity: 637,075 square metres**:
- 160,796 square metres of new leases
- 476,279 square metres of lease renewals
- Q4 occupancy: 97.7%
- Q4 Rent change: 34.4%**
- Full year rent change: 27.3%**
*includes operating, development, held for sale, other and VAA/VAC
** based on lease start date
Leasing Highlights Fourth Quarter 2023:
- 30,501 square metres at Prologis Park Coventry DC10, for IFCO Systems in the UK.
- 21,868 square metres at Prologis Park Plessis Pate DC1, for Alive Events in France.
- 19,779 square metres at Prologis Park Dabrowa DC1C, for BCUBE Poland Services Sp. z o.o. in Poland.
- 13,823 square metres at Prologis Park Moissy DC5, for EXPERIS France in France.
Capital Deployment – Fourth Quarter and Full Year 2023:
Development Starts:
- Total development activity in the fourth quarter was 137,833 square metres, in the Czech Republic, Poland, Germany, Italy and the UK, of which 55.6% was build-to-suit.
- Full year 2023 saw 26 development starts totalling 356,545 square metres, of which 60.3% was build-to-suit.
Additional commentary from Ben Bannatyne, President, Prologis Europe:
Over the past 12 months, our Prologis Essentials business has increasingly provided vital continuity for our customers’ operational needs. We understand that local requirements such as permitting are increasingly linked to ESG vision and measurable social impact, which is why our solutions in the areas of operations, energy + sustainability, mobility and workforce continue to evolve to stay ahead of what’s next. In the field of energy for instance, we ended the year on a high, reaching the halfway milestone of 500MW of on-roof solar generation and battery storage; putting us well on the track to surpassing our own goal of 1GW by 2025.
A Note from Eva van der Pluijm-kok, vice president, Prologis EU Research
Prologis has released its annual Seven Predictions research for the coming year. Our outlook highlights 2024 as a year of healthy demand growth, constrained supply, technological evolution of logistics facilities and a turning of the capital markets cycle.
What we see for 2024:
- Looking at the double-digit growth in port and truck traffic, the global freight recession is expected to reverse.
- The Great Construction Bust will intensify, with global starts hitting their lowest level since the 2008 financial crisis.
- Latin America has experienced record demand and this will continue into 2024, especially in Mexico as nearshored manufacturing capacity comes online.
- Net absorption in China will reach the second highest level on record, helping to work through excess supply from the past few years.
- Technology, especially artificial intelligence, will drive up energy requirements in logistics facilities, incentivising warehouse owners to double solar capacity.
- Interest rate declines will double private equity real estate funding in 2024.
- European cap rates expected to compress while expansion rotates to Asia.
GROUNDBREAKERS 2024 in LONDON
2024 brings some exciting opportunities for us as well: for the first time, our signature thought leadership event, GROUNDBREAKERS will take place in Europe! It’s in London in October and we’re gearing up for it to be a truly one-of-a-kind event, bringing leaders from the region for robust discussions such as innovations into energy sustainability, AI and supply chain. Join the mailing list for updates to secure your seat when registration opens.
Resources/Insights:
- Zero carbon certification: Prologis Park Eindhoven DC4 awarded world’s first zero carbon certification for logistics building
- ESG Report: 2022-2023 ESG Report
- GROUNDBREAKERS 2024: Check our website to secure your seat when registrations open or watch the 2023 replays.
- Trends: Seven Supply Predictions for 2024 (Dec 2023)
- Complete warehouse solutions platform: Find out more about the Prologis Essentials Platform.
- Prologis is the #1 real estate investment trust (REIT) on the 2022 Global 100 Most Sustainable Corporations in the World list. This is the company’s thirteenth appearance on the list, which is widely considered one of the most reputable sustainability rankings. Corporate Knights, a specialised media company and investment research firm, ranks publicly traded global companies on a broad scope of metrics related to environmental stewardship, social responsibility and governance (ESG).
- Prologis receives HRH The Prince of Wales' Terra Carta Seal