Logistics assets will continue to be popular but capital value may slow down

JLL said occupiers of warehouse spaces will be cautious due to rent hikes.

Demand for logistics properties and warehouse space was strong in the fourth quarter of 2022, which will remain in 2023 but will face headwinds, JLL said.

Other trends that will remain in 2023 are leasing activity for warehouses will be mostly renewals due to limited supply for larger premises. 

Average island-wide rents rose due to steady demand and space crunch.

All these trends will persist until next year but at a slower pace as occupiers may resist further rent hikes. 

Despite the rising interest rates, logistics/warehouse assets will be popular amongst investors but capital value growth could decelerate.

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