European logistics yields remain stable, investors confident

The latest Garbe Research indicates that prime yields in the European logistics real estate sector are stable, despite ongoing global uncertainties. 

Garbe prime yields

According to the Garbe Pyramid Map, there is a trend of moderate compression in yields, reflecting strong investor confidence in the asset class.
Looking ahead to mid-2030, a slight yield compression of around 40 basis points is anticipated, driven by easing interest rates and reduced risk aversion. This positive outlook is based on a survey of 88 regions and includes forecasts for 121 key submarkets across 25 European countries. Established markets like Germany, the Netherlands, and the UK are showing solid yield levels, with some areas like Munich and West Brabant potentially seeing yields drop below 4.0 percent.
In the first half of 2025, most regions (84 out of 88) experienced no change in prime yields. The European average saw a minimal hardening, decreasing by just 3 basis points to 5.58 percent. Spain was particularly dynamic, with notable yield compression in Zaragoza, Madrid, and Barcelona. Germany also showed signs of recovery, with yields declining in 16 regions, including a significant 20 basis point drop in Munich. Dutch markets like Amsterdam/Schiphol and Tilburg also saw yield rates drop by 10 basis points. Conversely, Italy, France, and Central and Eastern European regions largely maintained stable yields.
Overall, the report highlights the stability of European logistics real estate, emphasizing its appeal to investors due to stable or rising rents and intrinsic value retention, especially for Core+ properties with growth potential and classic core products with long-term leases.
The long-term outlook is of sustained stability in core markets, with signs of a modest recovery.
Tobias Kassner, head of Research and ESG at Garbe Industrial, commented: “This trend is a sign for stability and confidence. Investors appreciate the intrinsic value of logistics real estate – despite challenging parameters, the asset class remains a reliable anchor. Stability is the key characteristic of the current market cycle. Logistics real estate has proven to be among the asset classes with the highest value retention even during tough market cycles while delivering a high cash-flow return at the same time.”