European logistics sees surging confidence, mid-box preference

A new study by Brookfield Properties, Savills, and Analytiqa indicates a growing sense of optimism among real estate investors and developers in Europe's logistics sector. 

Brookfield logistics

This confidence is driven by an increase in occupiers planning to expand their warehouse space, with 41% expecting to do so in the next year, a significant rise from the previous year.
Investor sentiment is on the rise, with 46% finding market conditions more favorable than last year and 56% anticipating an increase in investment volumes. Developers are also ramping up activity, with 36% planning more speculative building.
While 41% of occupiers foresee an increase in their warehouse needs, 57% have also scaled back expansion plans, showing cautious optimism. There's a notable preference for "mid-box" units (5,000-9,999 m2) among occupiers, with two-thirds targeting this size.
Developers, however, are primarily focusing on "big-box" units (over 10,000 m2), leading to a potential gap between what occupiers want and what's being built. Only 25% of developers are speculatively building mid-box units.
Western Europe, especially Germany and France, is leading in planned expansion.
ESG regulations are seen as the most significant structural shift by 88% of occupiers. The adoption of AI is also rapidly accelerating, with 82% of occupiers viewing it as transformative—a 25% increase from last year. Many are already investing in AI-driven predictive optimization and analytics, with more planning to do so.
Ben Segelman, European head of Logistics and Data Centre Real Estate, Brookfield, said: “We are at a strategic inflection point in the logistics market. Investors are doubling down on long-term fundamentals and proactively creating the spaces they believe occupiers will need in the years to come. Occupiers remain cautious, recalibrating in response to macro and operational pressures, yet they are actively shaping strategies around ESG and AI to futureproof their portfolios. The next 12 to 18 months will be pivotal in aligning demand with the right kind of space.”
George Coleman, UK & EMEA Logistics, Savills, added: “This year’s Census, which achieved record response levels, underlines how structural shifts are shaping the next chapter of logistics real estate. ESG and AI are no longer emerging trends but central to occupier strategies, while investors and developers are positioning to deliver the space needed for this transformation. The sector continues to adapt with resilience and is building solid foundations for long-term sustained growth.”