Return of large logistics transactions in Europe

The European logistics real estate market in 2025 presented a mixed picture, with significant variations across countries due to economic conditions and geopolitical uncertainties.

Maasvlakte_DC3_Netherlands - BNP Paribas Real Estate

Despite these challenges, several key trends emerged across Europe, according to Craig Maguire, head of European Logistics at BNP Paribas Real Estate. A notable development was the resurgence of large transactions, particularly deals ranging from 20,000 to 40,000 m2. Vacancy rates showed strong disparities, ranging from 2% to 11% depending on the region. Rents continued to climb, driven by limited availability in highly constrained markets such as Barcelona, Milan, and Prague.
The UK experienced particularly strong activity in the Midlands (Birmingham), accounting for 40% of all transactions, with robust demand from the healthcare and defence sectors.
In Germany, transactions exceeding 20,000 m2 increased by 30%, largely fuelled by logistics providers serving e-commerce companies.
Activity in France declined by 4% due to economic and political uncertainties.
Supported by 2.9% GDP growth in 2025, the market in Spain nearly reached its record 2022 levels.
Netherlands saw an overall decline in volumes due to land scarcity and administrative hurdles; for the first time, second-hand supply surpassed new-build stock.
After a slow start to the year, take-up in Poland steadily increased in H2, and the vacancy rate slightly decreased to 7.4% in Q4 2025.
The largest European transactions, all exceeding 100,000 m2, were recorded in France and the UK, including two Amazon deals (Chartres and Beauvais) and a 120,000 square meter scheme for Marks & Spencer in northern England.
Rental Market Recovery
In 2025, prime logistics rents across Europe increased by an average of 4.5%. This sustained growth is attributed to limited land availability, a low level of speculative developments, rising construction costs, and the overall upgrading of warehouse specifications. This upward trend is expected to continue in 2026, though at a more moderate pace.
The industrial and logistics investment market made a confirmed recovery, with nearly €45 bn invested in 2025, returning to pre-crisis levels and supported by an average 11% growth across Europe. This rebound is driven by a more stable financial environment, better-controlled inflation, and renewed investor interest in logistics assets, which now account for a quarter of total European real estate investment, matching office assets.
However, performance remains uneven across the continent. Germany and the UK accounted for nearly 50% of total investment volumes, with the UK alone representing one-third of all European investments. These two markets, along with Sweden, benefited from large portfolio disposals. Germany saw a more measured activity over the year, with a notable acceleration in the second half driven by portfolio sales. Spain's strong macroeconomic environment continues to support its market.
Return of Large Deals
Large-scale transactions returned in 2025, including LondonMetric's acquisition of Urban Logistics' UK portfolio for €1.4 bn; Tritax Big Box's purchase of an industrial portfolio from Blackstone for €1.2 bn; and Segro's acquisition of a 370,000 m2 portfolio from Tritax Eurobox in Germany and the Netherlands.
Several pan-European joint ventures, such as the partnership between AustralianSuper and Oxford Properties, and the joint venture between AREIM and VGP, also contributed to market momentum, reflecting growing international investor appetite.
Prime Yields
In 2025, prime logistics yields tightened across major European economies, ranging between 4.5% in Germany and 5.4% in Italy. Higher-than-expected long-term interest rates led to a slight increase in yields in both France and Germany towards the end of the year. Craig Maguire anticipates a period of stabilisation in 2026, with steady yields and a moderate increase in capital values, supported by continued rental growth.