As e-commerce is increasingly gaining ground in the Danish market, players in the logistics market are accordingly revising their requirements in terms of location and type of facility.
In 2018, Danish online sales increased by 13% relative to 2017 (source: FDIH), reaching a new high. However, not only the volume of e-commerce is mounting, the same applies to the demands by both manufacturers and consumers. Both sides require prompt delivery, which has served to truly put city logistics and last mile distribution on the logistics industry’s agenda. As a result, e-commerce has become a key determinant of the future location and layout requirements of logistics businesses.
For several years now, logistics businesses have settled in the vicinity of Copenhagen, which has translated into lower vacancy rates and higher rental prices. Demand continues to focus on logistics facilities that meet today’s requirements in terms of ceiling height, area distribution and not least location. However, a new trend determines the demand for storage and logistics space as logistics businesses increasingly tend to favour a city location.
Only a decade ago, DHL was almost exclusively a B2B business, but today it offers also home deliveries. DHL has service centres at Copenhagen Airport, Fredericia and Skanderborg, just as it is possible to collect parcels at the Danish HQ in Vallensbæk. In addition, DHL has a number of service partners that make it possible to collect deliveries at about 400 collection points in Denmark, e.g. in so-called SwipBoxes typically located inside supermarkets.
According to Dan Waern, Director Corporate Real Estate with DHL, e-commerce has (in the Nordics) influenced DHL’s demand for properties.
“Today, we have different requirements of building configuration; for instance, the stronger flow of private customers that come to collect has made it necessary to add more parking spaces, and the same goes for reception and waiting areas”.
“Vacancy rates are record-low in the Greater Copenhagen market for industrial and logistics space; the end-2018 vacancy rate was as low as 2.7%,” says Helle Andersen, Commercial Real Estate Advisor, Industrial & Logistics, Colliers, and elaborates, “We believe that the vacancy rate covers the stock of old and outdated space that fails to meet today’s standards. We find it easy to let new space; for instance, we recently let the first lease unit at Greve Distributions Center, which was developed specifically with today’s tenant requirements in mind”.
All in all, Colliers sees a market that has been subject to brisk development in recent years. Apparently, this development continues in city locations.
Dan Waern of DHL was a speaker at Colliers first network group meeting for decision-makers in the industrial/logistics industry. Please contact Helle Andersen, Colliers, if you would like to be invited to the next meeting.
Commercial real estate advisor | Industrial and Logistic
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