At a Glance Valencia has seen two consecutive years of considerable activity on the part of demand, despite the slight reduction in 2013 Valencia Logistics Q1 2014 The vacancy rate continues to fall and the scarcity of units exceeding 10,000 m² is noteworthy VIGOROUS TRANSACTION ACTIVITY IN RECENT YEARS The automotive industry stimulates demand for logistics units in the southern zone of Valencia Trend in transaction volumes m² 160,000 140,000 120,000 BNP Paribas Real Estate – Research 100,000 80,000 60,000 40,000 20,000 0 2006 2007 2008 2009 2010 2011 2012 2013 Q1 2014 Transactions by size (Q1-2014) TRANSACTIONS FOCUSED ON UNITS OF LESS THAN 5000 M² The share of transactions relating to large-scale units falls due to the reduced offering of these types of facilities 13% 37% BNP Paribas Real Estate – Research 13% 37% < 3,000 m² 3,000 to 5,000 m² 5,000 to 10,000 m² >10,000 m² Logistics stock and vacancy rate Parque (izq) Tasa de disponibilidad ( dcho) m² % 1,800,000 18 1,500,000 14 1,200,000 10 8 600,000 6 4 300,000 2 0 0 2007 2008 2009 2010 2011 2012 2013 Q1 2014 BNP Paribas Real Estate – Research 12 900,000 The majority of transactions were undertaken on medium or small scale units (66% in 2013 and 75% in Q1 2014), in part due to the scarcity of very extensive facilities. Nonetheless, demand exists for units in excess of 10,000 m². This is unsatisfied due to the lack of immediately available product, lengthening the search times for floorspace meeting the requirements of users. Historically, the most sought-after logistics zone consisted of the Ribarroja del Turia, cornering some 65%-75% of transactions and floorspace taken up. This position of dominance has, however, changed since last year. The area of Almussafes has attracted a significant portion of demand, cornering almost half of transactions and floorspace transacted in 2013 and during the first quarter of 2014 . SUPPLY VERGING ON SCARCITY The vacancy rate has fallen continuously since 2010, reaching 6.5% in Q1 2014 16 2006 The logistics market in Valencia stands entirely apart from the general trend for other sites in Spain, thanks to the expansion of the Ford vehicle factory in Almussafes, the port activity and the integration of new distribution activities towards southern France. With take-up of 130,000 m² in 2013 and 38,000 m² during Q1 2014, both figures exceeding the historic averages for annual and quarterly take-up respectively, any interpretation must be positive. The main driver of occupancy consisted of an expansion in activity. Only 30% of transactions during 2013 were motivated by consolidation and the improvement of facilities. With two out of every three transactions the main prospective tenants currently consist of logistics final users, the remainder consisting of logistics providers. The healthy performance of demand and the standstill in real estate development have led to low levels of vacant supply. Somewhat less than 100,000 m² of immediately available supply exists in Valencia, a vacancy rate of 6.5%. This level of vacancies may activate a number of private developments. Although there is still no sign of development activity, demand remains constant. This may give rise to a bottleneck in the logistics market in Valencia towards the close of 2014 and during 2015 . AT A GLANCE - VALENCIA LOGISTICS MARKET - Q1 2014 Vacancy rate in the main zones Centre North CENTRAL AND SOUTHERN ZONES AT “PRE-CRISIS” LEVELS OF SUPPLY Developments could be activated during the second half of 2014 and in 2015. South % 30 25 BNP Paribas Real Estate – Research 20 15 10 5 0 2005 2006 2007 2008 2009 2010 2011 2012 2013 Trends in rents Max Min €/m²/month The zones of Ribarroja and Almussafes/Sollana have vacancy rates standing at 6.5% and 6.2% respectively. These levels have not been seen since 2006 and verge on scarcity. More specifically, around 60,000 m² exists in the area of Ribarroja (A-3 Highway) and 23,000 m² in the vicinity of the Ford factory in Almussafes and Sollana. This low level of vacancies for logistics units restricts the establishment of new logistics operations, particularly those relating to national distribution requiring floor spaces in excess of 10,000 m². Additionally there is an impact on rental prices with increases being seen in asking rents in the southern zone during Q1 2014. Lastly, these levels should stimulate developer activity with regard to units. A drought of new build has existed since 2008 and the reactivation of privately driven projects currently at a standstill may be seen. For its part, the vacancy rate in the northern zone has grown to 15%. However, that area’s low levels of logistics activity and with only 7000 m² available, means that it is not a pressure valve for the market. 7 PRIME RENTS UNCHANGED OVER THE PAST YEAR The aggregate drop since the peak in 2007 amounts to 50%. 6 BNP Paribas Real Estate – Research 5 4 3 2 1 0 2006 2007 2008 2009 Logistics stock and vacancy rate 2010 2011 2012 2013 Q1 2014 The best logistics units in the area of influence of Valencia have rents of €3-€3.50/m²/month. Production at the Ford factory in Almussafes has converted the area into a new prime zone, where the rents for the best units exceed those of the prime units in the area of the A-3. Nonetheless, Valencia remains competitive in rent compared with other sites such as Madrid and Barcelona, offering rents for logistics units which are some 20%-30% lower. Increases in rents are anticipated for the close of 2014, putting an end to the downward cycle in the Valencian logistics real estate market. OUTLOOK Scarcity could increase during the second half of 2014 Demand in the pipeline could point towards transaction activity similar to or slightly lower than that of 2013. At the same time, space reduction and regrouping strategies are no longer the flavour of the month, leading to positive take-up and a reduction in the available supply. Within this setting, 2014 will close with higher rents in the most sought-after zones, representing a stimulus to activity on the part of developers. It is possible that developments which came to a standstill in 2008-2012 will be coming to life once again. All rights reserved. At a Glance is protected in its entirety by copyright. No part of this publication may be reproduced, translated, transmitted, or stored in a retrieval system in any form or by any means, without the prior permission in writing of BNP Paribas Real Estate. Publisher and copyright: BNP Paribas Real Estate Further Information BNP Paribas Real Estate | Valencia brunch office| Telephone +34 963 163 120| www.realestate.bnpparibas.es Letings and sales: Sandrine Carriere —Head of Industrial/Logistics, Valencia. Email: [email protected] Joaquín Ivars — Head of Levante territory. Email: [email protected]
© Copyright 2024 ExpyDoc