Property Times European Logistics H1 2011 - DTZ

30 September 2011
Contents
Executive summary 1
Economic overview 2-4
Retail, E-retail & logistics 5
Investment market 6-7
Fair value index 8-9
Occupier market
European overview 10-12
Market overview 13-26
United Kingdom 13
Ireland 14
Belgium 15
France 16
Germany 17
Netherlands 18
Italy & Spain 19
Nordics & Sweden 20
CEE 21
Poland 22
Czech Republic 23
Hungary & Romania 24
Ukraine & Russia 25
Middle East - Dubai 26
Definitions 28
Contacts 29
Authors
Magali Marton
Head of CEMEA Research
+33 (0)1 49 64 49 54
magali.marton@dtz.com
Matthew Hall
Forecasting & Strategy Research
+44 (0)20 3296 3011
matthew.hall@dtz.com
Contacts
Tony McGough
Forecasting & Strategy Research
+44 (0)20 3296 2314
tony.mcgough@dtz.com
Hans Vrensen
Global Head of Research
+44 (0)20 3296 2159
hans.vrensen@dtz.com
Property Times
European Logistics H1 2011
Good results in H1 but
uncertainty predicted in H2
• Take-up in H1 2011 increased by an average of 25% in five of the
leading European markets (UK, Germany, France, CEE and Belgium),
boosted by a number of significant deals from the retail and distribution
sector (Figure 1).
• However, prospects for H2 2011 remain downbeat as the economic
context is now more uncertain, leading occupiers to delay their
relocation or expansion plans.
• Built-to-suit deals remain prominent as occupiers continue to seek high
quality buildings in good locations. As a result, vacancy rates remained
unchanged across Europe in the first half of the year, varying between
6% and 20% depending on the market.
• Prime rents have roughly stabilised across Europe, with a small
increase expected during 2012 in core markets.
• The logistics investment market has remained broadly stable, with €4.6
billion invested during the first half of 2011. Investors’ appetite for the
logistics sector remains stable, and marginally up on the equivalent
period last year. The Q2 2011 industrial DTZ Fair Value Index TM score
stands at 52, indicating that markets are fairly priced.
• In light of growing austerity measures throughout Europe, the strength
of the economic recovery anticipated during the second half of 2011
has been scaled back. Uncertainty has led to decisions being put on
hold as many occupiers adopt a holding approach.
Figure 1
Take-up in selected countries in Europe (000’s sq m )
Sq m
5 000
4 500
4 000
3 500
3 000
2 500
2 000
1 500
1 000
500
0
Source: DTZ Research
Germany UK CEE France Belgium
2007 2008 2009 2010 H1 2011
www.dtz.com 1

Economic overview
The improvement in the European economic
environment has not lasted the summer as
concerns over the debt crisis are rising. Market
conditions will become more challenging with an
increasingly mixed pictured of economic trends
across Europe.
• Stress tests of the banking system, debt crisis in
Europe, inability of governments to restore market
confidence and downgrading of the US economy: the
global and European economy has entered into a
new phase. European businesses continue to face
challenging credit conditions as banks are still
cautious about their loan policies.
Restrictive credit conditions will continue to weigh on
consumption and investment, and as a result
industrial production, consumption and retail sales
remain slow across Europe.
• The debt crisis has forced governments in many
European countries to put in place austerity
packages to reduce their fiscal deficit. Furthermore,
most of Europe is also facing a reduction in
government led growth, as a result of a slowdown in
private sector demand. In this context, European
GDP forecasts have been downgraded to 1.9% in
2011 and 1.6% in 2012 (Figure 2).
• In Europe, those countries most affected by the debt
crisis will post negative GDP growth in 2011 while
Germany, the Nordics and CEE continue to
outperform the European average (Figure 3). Neither
the Nordics nor the CEE are part of the Eurozone,
enabling control over monetary policy and hence,
exchange rates. Neither region has particularly high
levels of national debt requiring austerity measures.
• After a strong rebound in 2010, a modest 6.4%
increase of trade growth is anticipated for 2011,
However, uncertainty remains over the impact of a
number of recent events, including the earthquake
and tsunami in Japan. If achieved, this would be
higher than the 6.0% average yearly increase
witnessed between 1990 and 2008.
Figure 2
GDP growth 2007-2010 and forecasts 2011-2014
www.dtz.com 2
%
8
6
4
2
0
-2
-4
-6
2007 2008 2009 2010 2011F 2012F 2013F 2014F
Asia Pacific Eurozone United States
Source: Oxford Economics
Figure 3
GDP growth and growth forecasts in selected
European countries
%
4
4
3
3
2
2
1
1
0
2011F 2012F 2013F 2014F
France Germany Nordics
United Kingdom Eurozone
Source: Oxford Economics
Figure 4
Merchandise exports by region, 2007-2011
%
20
15
10
5
0
-5
-10
-15
-20
Source: WTO
14,5
6,4
12,9
World Developed
economies
4,5
16,7
9,5
Developing
economies and
CIS
2007 2008 2009 2010 2011F

Economic overview
• Industrial production forecasts suggest that Europe
will be polarised in the short term: Germany, CEE
and the Nordics growing by between 7% and 9% in
2011 - whilst the UK and France remain well below
the Eurozone average of 5.7% (Figure 5). However,
the latest PMI (Purchasing Manager Index) published
in August 2011 has clearly shown declining
confidence in the industrial sector, posting the
second weakest rate of expansion since the recovery
began in August 2009.
• Consumer confidence has also declined across
Europe with an increasingly negative balance of
opinions, down to -16.5% from -11% in December
2010 (Figure 6). Pressure is increasing on
governments to accelerate austerity programs and
reduce public debt. This is acting as a further drag on
consumer confidence as employees tighten their
belts. This is anticipated to have a significant impact
on the retail sector as consumer spending is forecast
to bear the brunt of austerity measures.
• Consumer spending in Europe will remain subdued in
the medium term with 1.2% pa expected between
2011 and 2014 (Figure 7). The three major
economies – UK, France and Germany – are slightly
above the regional average whilst CEE and Nordics
will outperform with between 2% and 3% pa over the
same period. There, domestic demand is supported
by strong GDP growth and limited exposure to
austerity measures.
• In conclusion, the logistics market in Europe will be
driven by two opposing economic trends: firstly,
strong prospects for CEE and the Nordics on both
the industrial and consumer side, and secondly,
direct or indirect impacts of austerity measures
across the region. A degradation of the general
sentiment has already become apparent, leading
industrial and logistics companies to act with caution
regarding their expansion or relocation plans.
Figure 5
Industrial production in selected European countries
www.dtz.com 3
%
15
10
5
0
-5
-10
-15
-20
2007 2008 2009 2010 2011F 2012F 2013F 2014F
CEE France Germany
Nordics United Kingdom Eurozone
Source: Oxford Economics
Figure 6
Eurozone business & consumer confidence
(% balance)
% Balance
1,6
1,4
1,2
1
0,8
0,6
0,4
0,2
0
Source: Oxford Economics
Figure 7
Business (LHS) Consumer (RHS)
0
-2
-4
-6
-8
-10
-12
-14
-16
-18
Consumer spending in selected European countries
%
6
4
2
0
-2
-4
-6
2007 2008 2009 2010 2011F 2012F 2013F 2014F
CEE France Germany
Nordics United Kingdom Eurozone
Source: Oxford Economics

Economic overview
Figure 8
GDP growth in 2011
GDP growth in 2011
-4.8% - 0%
0.1% - 2.0%
2.1% - 4.0%
4.1% - 6.4%
No data
Portugal
Ireland
Spain
United Kingdom
Source : DTZ Research, ESRI, Oxford Economics
Source: Oxford Economics
France
Belgium
Denmark
Netherlands
Luxembourg
Norway
Germany
Switzerland
Sweden
Czech Republic
Italy
Austria
• Figure 8 illustrates the GDP growth anticipated for
2011. The 3 major economies – the UK, France and
Germany – will see their GDP figures grow. Germany
will lead with 3.5% growth expected, followed by
France (2.2%) and the UK (1.4%).
Bosnia and Herzegovina
Serbia
Montenegro Kosovo
Russian Federation
www.dtz.com 4
Poland
Slovenia
Croatia
Malta
Slovakia
Hungary
Albania
Finland
Estonia
Latvia
Lithuania
FYR of Macedonia
Greece
Romania
Belarus
Bulgaria
Ukraine
Republic of Moldova
Turkey
Cyprus
• GDP growth is expected to be strongest in the
Nordics and CEE, especially in Poland, Russia and
Turkey, while the PIIGS struggle well below the
European average (1.9%).

Retail, E-retail & logistics
Retail & Logistics
• Although retail sales growth was still in negative
territory at the end of 2010, the declines are much
shallower than in 2009. By the end of 2011, all the
major markets in Europe are forecast to return to
retail sales growth, with the exceptions of Greece,
Spain, Portugal and Italy (Figure 9).
• As a result of the downturn, retailers have become
extremely selective on their choice of stores and
locations, favouring larger units in new retail formats
located in city centres. These changes, mainly
prevalent in the food sector, will impact their supply
chain and, ultimately, their logistics requirements.
• Increased efficiency in the supply chain and cost
cutting measures will drive retailers and their third
party providers to review their existing networks in
two ways: by relocating to main distribution hubs
across Europe in order to take advantage of good
locations for both production and distribution, and by
identifying hot spots at a local level for the distribution
of goods to the consumers.
E-retail & logistics
• E-commerce is one of the fastest-growing sectors in
Europe, with an average increase of 5.9% during
2010. Online sales are forecast to increase by 14% in
the UK this year. In continental Europe, the pace of
the online retail growth will be higher, ranging from
15% in Germany to a record level of 33.5% in Poland
(Figure 10). Consequently, the market share of online
sales will grow to represent 12% in the UK, and an
average of 6% in Continental Europe.
• The anticipation of business growth linked to eretailing
has already generated new orders from eretailers
in UK, France and more recently Germany,
where Amazon has signed the two biggest
transactions of H1 2011. E-retailer requirements are
focused on large logistics schemes on the periphery
but also medium and small sized warehouses close
to town centres for “last mile” distribution.
Figure 9
Retail sales annual forecasts (2011-2020) in Europe
Source: Oxford Economics
Figure 10
Forecast growth in online sales, 2011
Poland
www.dtz.com 5
50
40
30
20
10
0
% increase
online
sales 2010-
2011
Italy
Spain
France
Switzerland
Benelux
UK
Germany
0 3 6 9 12 15
2011 online share of all retail business (%)
Source: Centre for Retail Research

Investment Market
High investment volumes in the Nordic and
CEE countries.
• The logistics investment market has remained
broadly stable in the first half of 2011 – with €4.6
billion invested. This level is roughly in line with the
€8.4 billion invested during the whole of 2010. As
highlighted previously, the recovery in the logistics
investment market is still on track, but at a slower
pace than the global market, which registered a 13%
increase during the same period.
• The proportion of industrial and logistics assets in
global investment volumes grew by 10% in H1 2011,
up from the 8% recorded in 2010. Despite this
increase in market share, the logistics sector remains
secondary to the market recovery witnessed in the
retail and office sectors.
• The UK market has the highest investment volume in
Europe with €1.3 billion, representing 29% of
European deals during H1 2011 (Figure 12). Strong
performance in the UK market is mainly linked to
several portfolio purchases and a strong activity in
the €20-50 million range.
• The German investment market remains dynamic
with volumes close to €800 million, well on track to
exceed the €1.2 billion transacted during 2010. Two
deals above €100 million were registered, including
one by Goodman on the ING's Industrial Fund
portfolio (11 properties representing 367,091 sq m
located in or in the vicinity of Bremen and Berlin).
• Market activity has remained subdued in France with
less than €300 million invested, while the CEE
markets registered their best performance in over a
decade with €450 million invested. This strong
performance is mainly linked to the €272 million
Europolis portfolio deal.
• After its peak of H2 2010, with €1.1 billion transacted,
the Nordics has maintained its high performance by
posting one of the highest levels of investment
volumes recorded in H1 2011 – near €900 million.
Local investors showed strong demand for logistics
assets ranging between €20 and €100 million.
Figure 11
European investment activity in logistics
www.dtz.com 6
Bn €
18
16
14
12
10
8
6
4
2
0
Source: DTZ Research
Figure 12
12%
10%
8%
6%
4%
2%
0%
Logistics investment Share of logistics investment
Logistics investment volume in Europe
18
16
14
12
10
8
6
4
2
0
UK France Germany CEE Nordics Others
Source: DTZ Research

Investment Market
Prime yields stabilizing in the UK and
French markets; elsewhere compression is
ongoing
• Contrasting trends between prime European logistics
yields have been observed in H1 2011. After strong
compression in 2010, yields in the UK, Sweden and
France have stabilised or increased slightly.
Elsewhere compression is still ongoing but at a
varied pace, depending on the country considered.
Compression is slow in Brussels (-150 bps) and
Germany (-100 bps), as the yields are approaching
their lowest point and more pronounced in Warsaw (-
250 bps), and CEE, where compression has just
begun (Figure 13).
• The range of prime logistics yields across Europe
has been reduced in H1 2011 with most of the
markets covered in our analysis now priced between
6 and 8%. However, Bucharest, Budapest, Moscow
and Kiev are priced above 9%. Average prime yields
in Europe are close to 7.50%, with the UK market
slightly below and CEE markets above.
• Looking forward to 2015, prime yields are not
expected to change dramatically, with a modest
annual capital growth of 1.2% anticipated from 2012
to 2015. CEE markets and Spain will outperform with
an increase from 2 to 5% over the same period. The
three major markets – UK, France and Germany –
will see yields moving by 10-15 bps in France, 10-15
bps in Germany and 0-25 bps in UK between 2011
and 2015.
Figure 13
Logistics prime yields in Europe, 2000-Q4 2010
www.dtz.com 7
%
14
12
10
8
6
4
Source: DTZ Research
Brussels Paris
Munich Warsaw
Stockholm London (Heathrow)

Fair Value Index
Logistics shown as fairly priced across
Europe in Q2 2011, as Fair Value Index
stands at 52
• Based on our Fair Value analysis, both logistics and
retail remain the most attractive sectors with an index
score of 52, compared to only 28 for offices (Figure
14). More than 24 of the 27 European logistics
markets covered by our Fair Value Index are
currently attractively priced.
• The number of European logistics markets currently
identified as HOT (under-priced by more than 5%)
decreased in the 2 nd quarter 2011, to five from eight
at the end of 2010.
• Prime industrial yields in most major markets have
held at a relatively high level. Notable exceptions are
London Heathrow and the Greater Paris Region,
where international interest has driven significant
yield compression.
• A wide range of attractive markets across Europe
have been identified in Q2 2011: Prague, Antwerp,
Barcelona, Manchester, Brussels and Bucharest. The
latter has posted the largest upgrade of the half year,
moving from twenty fourth place in Q4 2010 to sixth
position in Q2 2011. Its attractiveness is explained by
high income returns and expected annualised capital
growth of around 1.6% per year between 2011 and
2015 over a risk free rate of around 5%.
• Some opportunities can still be found in emerging
CEE markets, like Prague (classified as HOT) and
Warsaw (WARM). Budapest is currently classified as
COLD as forecast rent and yield movements of over
the next 5 years fail to deliver returns strong enough
to compensate for the given risks (Table 1).
• Amongst the most mature markets, Germany
(Hamburg and Frankfurt) and France (Greater Paris
Region, Lyon, and Marseilles) are now classified in
the WARM category. Prime yield compression has
not matched the five year government bond yield
movements, restoring some relative attractiveness
for logistics assets.
Figure 14
Fair Value Index – Europe
www.dtz.com 8
70
60
50
40
30
20
10
0
All property Office Retail Logistics
Q2 2010 Q3 2010 Q4 2010 Q1 2011 Q2 2011
Source: DTZ Research
Table 1
Fair Value Classifications – Key Industrial Markets
Q2 2011
Under/over
Category Market
valuation
HOT
WARM
COLD
Source: DTZ Research
Prague -9%
Antwerp -9%
Barcelona -8%
Manchester -8%
Brussels -6%
Greater Paris
Region
-3%
Hamburg -2%
Madrid -0%
Warsaw 2%
Rotterdam 3%
London Heathrow 4%
Amsterdam
Budapest
Oslo
Dublin
6%
6%
6%
8%

Fair Value Index
Map 1
Prime industrial yields in Europe (Q2 2011) and yield shift expected in 2011-2015
Prime yield
5.75% - 6.99%
7.00% - 7.99%
8.00% - 8.99%
9.00% - 10.50%
Yield shift (2011-2015)
-75 to -26 bps
-25 to 25 bps
26 to 50 bps
Dublin
Source : DTZ Research, ESRI
Glasgow
Bristol
Madrid
Manchester
London (Heathrow)
Amsterdam
Paris (IDF)
Brussels
Lyon
Rotterdam
Antwerp
Marseille
Barcelona
Oslo
Hamburg
Frankfurt
Milan
Gothenburg
Copenhagen
Berlin
Rome
www.dtz.com 9
Prague
Budapest
Helsinki
Warsaw
Bucharest

Occupier market – European market overview
Good performance in H1 2011 but a high
degree of uncertainty about H2 2011
• H1 2011 witnessed a strong European economic
recovery, until further escalation of the debt crisis
during the summer. Growth in consumption and the
resulting uptick in industrial production led to an
increasingly positive outlook. The first half year of
2011 saw an increased level of take-up, with 6.9
million sq m registered in five of the leading
European markets, up from 5.5 million sq m during
the same period a year ago (Figure 15).
• German and CEE logistics markets, especially in
Poland, have been boosted by a strong economic
recovery. Retailers and manufacturers were quick to
take advantage of improving sentiment and
opportunities. Take-up in Germany and the CEE has
seen an increase of 42% and 28% respectively. In
France and Belgium, increased activity has been
concentrated in core markets, whilst secondary
markets are still struggling with flat occupier demand.
Finally, the UK market is experiencing a huge decline
of Grade A supply while the demand from the retail
and manufacturing sectors, although subdued
relative to historical averages, remains constant.
• Expansion plans were beginning to return to the
agenda of many retail and manufacturing companies.
However, their market approach remains cautious as
most are unwilling to compromise on either quality or
location, given their perception of current market
conditions. Built-to-suit schemes have grown in
popularity as occupiers have fewer good quality
buildings to choose from within the existing supply.
This “flight to quality” has kept vacancy rates roughly
unchanged, varying between 6 and 20% depending
on the market.
• The financial crisis of the summer has led to a large
number of requirements being put on hold.
Furthermore, the crisis will negatively impact levels of
speculative development of logistics space. H2 2011
results will depend on the capacity of the European
Union to deal with the sovereign debt crisis and
restore confidence. This process should take several
months; we therefore expect to see more challenging
market conditions leading to a decrease in take-up
levels during the second half of 2011.
Figure 15
Take-up in selected* countries in Europe
in 000 of sq m
www.dtz.com 10
Sq m
5 000
4 500
4 000
3 500
3 000
2 500
2 000
1 500
1 000
500
0
Source: DTZ Research
Germany UK CEE France Belgium
2007 2008 2009 2010 H1 2011

Occupier market – European overview
Map 2
Prime industrial rents in Europe (Q2 2011) and annual growth expected between 2011 and 2015
Prime rent (€/sq m/year)
41 - 50
51 - 75
76 - 100
101 - 151
Annual rental growth (2011-2015)
2.1% - 3.5%
1.1% - 2.0%
0.0% - 1.0%
Dublin
Source : DTZ Research, ESRI
Glasgow
Rotterdam
Bristol Antwerp
Madrid
Manchester
London (Heathrow)
Amsterdam
Paris (IDF)
Brussels
Lyon
Marseille
Barcelona
Milan
Oslo
Hamburg
Frankfurt
Gothenburg
Copenhagen
www.dtz.com 11
Berlin
Rome
Prague
Helsinki
Warsaw
Budapest
Bucharest

Occupier market – European overview
Prime rents stabilising in H1 2011
• After strong decreases registered in 2009 and 2010,
prime rents are now stabilising. Occupier demand
has been growing after two years of stagnation, but
many European markets are still suffering from a
high level of vacant space. Therefore rents remain
under pressure (Figure 16).
• 41 European markets out of the 50 covered by our
analysis have seen prime logistics rents remain
stable during the first half of 2011. Behind this
apparent rental stability, landlords are still flexible
over incentives, especially in the markets where
supply is abundant and demand is limited.
• Among the major markets, Dublin has posted the
largest decrease (-7%) in rents over the period, while
Greater Paris Region, Istanbul and Brussels saw
their rents increase by 2%, 6% and 10% respectively.
Marginal upward trend in rents expected
across Europe by the end of 2011
• 2011 will see prime industrial rental growth returning
to positive territory, following the recovery already
experienced in the office and retail sectors during
2010. Prime European industrial rents are forecast
to increase on average by just over 1.5% pa,
compared to 1.7% for retail and 2.5% for the office
sector. Despite this positive forecast for the
European market, prime rents will stay below their
historical peaks.
• The rental recovery seen in some markets in H1
2011 should gradually spread across Europe, as
most markets are expecting to see rental growth by
the end of 2011.
• Berlin, Bucharest, Rome and Copenhagen are the
only markets on the periphery of the recovery. At the
other end of the scale, the biggest increases are
expected in Barcelona (3.6%), partially reversing the
8% decrease registered between 2006 and 2010.
Prime rents in the Greater Paris Region are forecast
to increase by 2.2% to return to 2009 levels. CEE
markets will benefit from the upward trend with a 2%
rise anticipated in Warsaw and Prague (Figure 17).
Figure 16
European prime rents, 2000- Q2 2011
Base 100 = Q4 2000
www.dtz.com 12
110
100
90
80
70
60
Source: DTZ Research
Figure 17
Barcelona Birmingham
Frankfurt Greater Paris Region
Rotterdam Warsaw
European prime rents, 2011 and 2015, biggest
increases
Marseille
Greater Paris
Region
Brussels
Prague
Birmingham
Manchester
Warsaw
Barcelona
€ per sq m per
year
Source: DTZ Research
30 40 50 60 70 80
Q2 2011 2015F

Occupiers market – Country overview
United Kingdom
Manufacturing and retail sectors boost occupier
demand
• Take-up during the first half of 2011 came in at
approximately 1.1m sq m, showing a slowdown
compared to the 2.6m sq m achieved in 2010. The
slowdown has been more visible in Q2 2011 with
492,000 sq m let (Figure 18). Occupiers seem
inclined to place decisions on hold as uncertainty
over the economic climate, including the revision to
the UK outlook, dictate caution.
• The drop in activity was mainly due to a fall in
average deal size, since the number of transactions
in Q2 was fairly similar to the number in Q1. This
reduction in the average deal size was a result of a
change in the profile of occupiers. Large distribution
deals were rare during the quarter as manufacturing
occupiers, which take smaller units than logistics
users, demonstrated increased activity. Although
manufacturing gains have dominated headlines, retail
and internet retail requirements continue to provide a
significant proportion of market demand for big sheds.
• Supply side conditions continue to tighten as
speculative construction is yet to return in any
meaningful volume, despite a notable shortage of the
best quality space (Figure 19). Many tenants are
resorting to built to suit as the only option for new
space. Additionally diminishing supply of large,
Grade A buildings is likely to encourage a number of
deals as occupiers bring forward requirements to
secure space in the few remaining buildings.
• There was no appreciable rental movement during
H1 2011, but it is clear that the market is returning to
a more balanced position. However, before any
rental movement takes place, incentives will have to
undergo some significant tightening. Although the
overall rental growth forecast remains consistent with
the previous forecast, spikes of undersupply in some
markets have, in turn, prompted uplifts in rental
growth. Despite the rental growth acceleration
throughout the forecast period, the overall average,
as well as the growth peaks, remains below historical
values.
Figure 18
Aggregate regional take-up in UK
Sq m
1 200 000
1 000 000
www.dtz.com 13
800 000
600 000
400 000
200 000
Source: DTZ Research
Figure 19
-
A B C
National availability by grade
Sq m
25 000 000
20 000 000
15 000 000
10 000 000
5 000 000
Source: DTZ Research
Figure 20
-
Q4
2009
Q1
2010
Q2
2010
Q3
2010
Q4
2010
Prime Secondary
Q1
2011
DTZ prime industrial annual rental growth
5%
4%
3%
2%
1%
0%
-1%
-2%
-3%
-4%
Source: DTZ Research
Q2
2011

Occupiers market – Country overview
Ireland
A positive sign of recovery but the market is still
under pressure
• In line with the signs of recovery noticed at the end of
2010, the Dublin industrial market registered a strong
performance both in terms of total transacted space
and individual deals completed in H1 2011 with
80,900 sq m (Figure 21), posting a modest increase
compared to the same period in 2010. Levels,
however, remain significantly lower relative to the
long run annual average level of transactions.
• The opening six months of the year witnessed further
improvements in both sentiment and activity
indicators such as enquiry levels and requirements,
albeit off a low base.
• Since the onset of the downturn, the appetite for
freehold purchases has been limited. Occupiers have
instead been opting for more flexible leasehold
transactions as an occupational preference. However,
2011 has seen renewed interest in purchase options,
with approximately 39% of floorspace transacted
during the first six months of the year.
• Supply levels in the Dublin industrial market declined
to 971,600 sq m at the end of June 2011. This
represents the first reduction in availability in three
years and follows a leveling off in the upward trend
noted in the previous quarter. While this marks a
positive development for the industrial market, given
the current economic climate, supply levels are
expected to fluctuate over the coming quarters. In
line with a modest decrease in supply levels, the
vacancy rate declined to 23.9% at the end of June,
down from 24% recorded at the end of 2010.
• Rents have continued on their downward spiral as
landlords continue to compete for the few active
requirements in the market at present. Prime
headline rents are now in the region of €60 per sq m.
However incentives are only playing a minimal part
during negotiations as landlords have reduced the
rent from lease commencement and have not kept
the rents artificially high while including incentives.
• The construction of logistics/industrial
accommodation has completely ceased; however,
there is a limited amount of good quality
accommodation available with the potential that new
requirements will have to opt for expensive design
and build solutions in the short to medium term.
Figure 21
Take-up & availability ratio in Ireland
www.dtz.com 14
Sq m
400 000
350 000
300 000
250 000
200 000
150 000
100 000
50 000
0
Source: DTZ Research
Figure 22
Prime rents in Dublin
€/ sq m /y
130
120
110
100
90
80
70
60
Source: DTZ Research
Take-up Availability ratio
25%
20%
15%
10%
5%
0%

Occupiers market – Country overview
Belgium
High level of take-up in H1 2011 but modest
growth of prime rents anticipated until 2015
• The first half of 2011 has seen the Belgian logistics
market reaching a record level of 520,000 sq m
taken-up, compared to an annual average of 490,000
sq m (Figure 23). These better than average results
are mainly linked to strong activity in the Flanders
region, which accounted for approximately 465,000
sq m of take-up. Over the first half, this region has
attracted major deals, such as Maxeda Brico on
34,000 sq m of logistics space in Willebroek and
more recently Spar Retail and Nike Europe on
premises above 40,000 sq m.
• The top five deals of the first half of the year included
four purchases for owner occupation. All these deals
were for facilities between 20,000 sq m and 50,000
sq m.
• The high level of activity seen in H1 2011 has dried
up the supply and a large portion of the vacant stock
has been let during the last 12 -18 months. Grade A
supply has shrunk as speculative construction has
remained subdued. The quality of the remaining
supply is becoming an issue, leading many occupiers
to a built-to-suit solution.
• The rental value decline registered since the end of
2007 has halted in H1 2011 and prime rents are
stabilising at €48 per sq m in Antwerp. Brussels has
seen its rents coming back to a level of €55 per sq m
while the rental adjustment is still ongoing in Liege
(Figure 24). Going forward, we don’t expect any
major changes to prime rents with a forecast 2.2% pa
in Brussels and 1.6% pa in Antwerp from 2011 to
2015.
Figure 23
Aggregate regional take-up in Belgium
600 000
500 000
400 000
300 000
200 000
100 000
www.dtz.com 15
Sq m
-
Source: DTZ Research
Figure 24
Flanders Brussels (incl. Brabant) Wallonia
Prime rents in Belgium
€/ sq m /
year
60
50
40
30
Source: DTZ Research
Antwerp Brussels Liege

Occupiers market – Country overview
France
Falling supply as a result of strong levels of
activity in core markets
• The French logistics market recorded strong levels of
activity in the first half of 2011, with take-up reaching
1.1 m sq m, representing a 31% increase compared
to H1 2010. The four core markets (Greater Paris
Region, Lille, Lyon and Marseilles) witnessed higher
levels of activity than previous quarters. The biggest
increase in take up was registered in Lyon where,
after a difficult 2010 (with take-up only reaching
236,000 sq m), was recorded 198,000 sq m of takeup
in H1 2011 alone. The level of activity in the
Greater Paris Region market remained unchanged at
414,000 sq m.
• Meanwhile, the continuous increase of immediately
available supply seen since the end of 2007 has
stopped. The first signs of decline (-10% during the
last 6 months) has seen supply fall to 2.7 m of sq m,
compared to 3 m sq m at the end of 2010. This
decline is a common trend in the 4 core markets but
in variable proportions: from -7% in the Greater Paris
Region (903,000 sq m) to -29% in Marseilles
(133,000 sq m). Despite stronger take up, the Lyon
market is still suffering from a high level of vacancy,
with 500,000 sq m immediately available, at a
vacancy ratio of 12% (Figure 26).
• Prime logistics rents remained stable at €41-43 per
sq m in Marseille and Lyon and close to €50 per sq m
in the Greater Paris Region at the end of H1 2011.
The trend of increased take-up noticed in the first half
of the year and strong prospects for the second half,
allow some optimism regarding further rental growth,
firstly in the Greater Paris Region and Marseille for
the end of the year, and in Lyon in 2012. However,
rents will not return to their pre-crisis level before
2013/2014. Meanwhile, landlords will continue to
offer incentives in the markets where immediate
supply is large, especially on medium-sized buildings
Figure 25
Take-up in France
Sq m
2 500 000
2 000 000
1 500 000
1 000 000
www.dtz.com 16
500 000
0
Source: DTZ Research
Figure 26
2004 2005 2006 2007 2008 2009 2010 H1
2011
Greater Paris Region Outside GPR
Vacancy rates in France
18%
16%
14%
12%
10%
8%
6%
4%
2%
0%
Source: DTZ Research
Figure 27
Greater Paris Region Lyon Marseille
Prime rents in France
€/ sqm
/year
60
55
50
45
40
35
Source: DTZ Research
Q4 Q4 Q4 Q4 Q4 Q4 Q4 Q4 Q4 Q4 Q2
2001 2002 20032004
2005 2006 2007 2008 2009 2010 2011
Greater Paris Region Lyon Marseille Lille

Occupiers market – Country overview
Germany
Record level of take-up, boosted by major
transactions on built-to-suit developments
• On the back of a positive economic outlook, the
German market has continued to see growth in takeup
to 2.7 m sq m in H1 2011 from 1.9 m sq m in H1
2010. The market posted a 41% increase on an
annual basis, thus ranking one of the most active
markets throughout Europe. Food retailers are keen
to move from old warehouses to new developments,
especially on built-to-suit premises; whereas demand
from the manufacturing sector is more focused on
existing and second-hand buildings.
• The economic troubles dominating Europe since the
summer could impact negatively on the level of
demand for logistics space in Germany as
uncertainty increases. Therefore we anticipate a
lower level of take-up for the rest of the year, but
despite this, 2011 should remain one of the best
years in terms of take-up levels (Figure 28).
• Construction activity is slowly returning in Germany,
even if pre-letting of these new developments is still
required. Thus, Goodman has signed with e-retailer
Amazon for a built-to-suit development of 110,000 sq
m in Rheinberg and another one of 110,000 sq m in
Bavaria. These buildings will be delivered within 5
months.
• During the first half of 2011, headline rents in the five
major markets of Germany remained unchanged
compared to their levels at the end of 2010. Prime
rents of modern logistics space stand at €74 per sq
m in Munich and at €68 per sq m in Frankfurt, making
these two regions the most expensive in Germany.
(Figure 29). Strong performance in the Frankfurt
logistics market will have a positive impact on prime
rents with a 3.8% increase anticipated in 2011 - to
reach €71 per sq m, while Hamburg will see prime
rents rising at a slower pace, at around 1.8% per
annum from 2011 to 2013.
Figure 28
Take-up in Germany
Sq m
3 000 000
2 500 000
2 000 000
1 500 000
1 000 000
500 000
www.dtz.com 17
0
Source: DTZ Research
Figure 29
2004 2005 2006 2007 2008 2009 2010 H1
2011
Top 5 markets Outside top 5 markets
Prime rents in Germany
€/ sq m
/year
80
75
70
65
60
55
50
Source: DTZ Research
Berlin Dusseldorf Frankfurt
Hamburg Munich

Occupiers market – Country overview
The Netherlands
Strong activity outside the three main markets
• After a strong rebound in H2 2010 with take-up
reaching 200,000 sq m in the three major markets
(Amsterdam, Rotterdam and Utrecht), the Dutch
logistics market returned to lower levels of activity in
H1 2011, with take-up reaching 100,000 sq m only.
(Figure 30). Market activity has been particularly
subdued in Amsterdam and Rotterdam since the
beginning of the year, whilst Utrecht recorded 50% of
total transactions. At a national level, the market is
more dynamic with take-up close to 453,000 sq m; a
similar level to that reached for the whole of 2010
(512,000 sq m). Most of the main transactions over
the period took place outside the three main markets,
with important deals including that of TNT Fashion
Group B.V. and Plus 100 B.V.in the Brabant region.
• Logistics providers such as Kuehne & Nagel, as well
as retailers, have supported the market with
requirements of above 10,000 sq m. Clearly identified
as a hub for the European market, the Dutch logistics
market benefits from its strategic position with the
ports of Rotterdam and Amsterdam. A revival of the
logistics market is expected in the surrounding area
of the Schipol airport thanks to a new urban
development project.
• Rents have remained stable, with values in
Amsterdam close to €65 per sq m (Figure 31). No
rental growth is expected for the rest of the year, with
a slight increase of 1.5% expected in 2012 at the
earliest.
Figure 30
Take-up in main city regions in the Netherlands
000 sq m
www.dtz.com 18
350
300
250
200
150
100
50
0
Source: DTZ Research
Figure 31
2007 2008 2009 2010 H1 2011
Amsterdam Rotterdam Utrecht
Prime rents in the Netherlands
€/ sq m
/year
80
75
70
65
60
55
50
Source: DTZ Research
Amsterdam Rotterdam Utrecht

Occupiers market – Country overview
Italy
Economic turmoil postpones the rental recovery
• No major changes have been noticed in the Italian
logistics market where the level of take-up is still well
below the long term average. Most of the lettings
registered in H1 2011 were built-to-suit deals,
keeping the vacancy ratio at around 7%.
Approximately 450,000 sq m is currently available on
the Milanese logistics market.
• Prime rents remained stable during H1 2011 (Figure
32). The austerity measures put in place by the
Italian government to reduce its public debt will
impact negatively on consumption and therefore a
decline in industrial production and foreign trade is
expected. In this context, the rental recovery
expected in 2012 will be delayed until 2013, with a
modest 1.8% annual increase.
Spain
Take-up slows but new developments stops
• The beginning of 2011 did not confirm the rebound
noticed at the end of 2010 and the Spanish market
has maintained a low level of activity with only 92,000
of take-up in Madrid and 65,000 sq m in Barcelona.
The absence of construction starts during this period
adds further evidence of a tightening market, on the
back of an increasingly negative economic outlook.
• Vacancy rates have risen in the two main markets of
Spain, reaching 9% in Madrid and 12% in Barcelona.
• In this context, rents have stabilized in H1 2011 at
€70 per sq m in Madrid and €63 per sq m in
Barcelona (Figure 33). Based on our forecasts, prime
rents will increase to €72 per sq m in Madrid, and
€68 per sq m in Barcelona in 2012 at the earliest.
Despite this recovery, rental values will not return to
previous peaks within the next five years.
Figure 32
Prime rents in Italy
€/ sq m
/year
65
www.dtz.com 19
60
55
50
45
Source: DTZ Research
Figure 33
Prime rents in Spain
€/ sq m
/year
110
100
90
80
70
60
Source: DTZ Research
Milan Rome
Barcelona Madrid

Occupiers market – Country overview
Nordics
Positive economic prospects but market
structure discouraging speculative construction
• On the back of strong economic prospects with GDP
growth forecast at 2.5% per annum between 2011
and 2015 and consumer spending growth of 2.3%
per annum over the same period, the Nordic region
should see demand for logistics spaces growing in
the short term. However, the market remains
characterised by a high ratio of owner occupation
and the attempts of developers to enter these
markets have not been successful.
• Occupiers are reluctant to move away from the
suburbs of the main cities across the region where
large land banks are available for new developments.
In the Danish market, occupier demand is mainly
focused on the triangle area on the German border
which allows the distribution of products in the whole
country. The 18 kilometers bridge between Denmark
and Germany planned for opening in 2018 should
impact positively on the market; however some
relocation from Sweden is expected.
Sweden
• In many ways, Sweden is the geographical centre of
the Nordic region, with a relatively sparse population
and widely spread industry. This has dictated the
structure of Sweden’s domestic logistics operations,
and spurred infrastructure investments to meet the
needs of home-grown multinationals such as Atlas
Copco, Electrolux, Ericsson, IKEA, Saab, Scania,
SKF and Volvo.
• The vacancy situation in logistics property is very
heterogeneous with a divider between prime and
more secondary buildings. In general, very few
projects are built on speculative basis in Sweden,
and consequently, the vacancy of newly built prime
logistics premises in good locations is virtually nonexisting
at the moment.
• Rents on new logistics properties are mainly
determined by the cost of land and construction.
Since there is an adequate supply of available land in
many locations in Sweden, there is never a great
imbalance between the supply and demand, which is
a prerequisite for strong increases in the logistics
rents (Figure 34).
Figure 34
Prime rents in Nordic countries
€ / sq m /
year
150
www.dtz.com 20
125
100
75
50
Source: DTZ Research
Copenhagen Helsinki Oslo Stockholm

Occupiers market – Country overview
Central and Eastern Europe
• The CEE markets – namely the Czech Republic,
Hungary, Poland and Romania – are expected to
lead the economic recovery in 2011 and in 2012.
Poland continues to outperform Europe with GDP
growth above 4% per year from 2011 to 2013,
compared to a modest 1.7% pa in the Eurozone.
Although forecasts for 2011 in Romania remain
negative, medium-term forecasts indicate a strong
recovery (Figure 35).
• Once again, the Polish economy outperforms the
Eurozone and the other CEE markets in terms of
consumer spending with a 4% per annum. increase
over the next three years. Still in trouble, Hungary is
expected to post a decline in industrial production
whilst in Romania, acceleration is expected in 2012
and 2013 with a 6% pa growth.
• Positive signals from the industrial production sector
should also be mentioned. In this area, the CEE
appears as the most attractive region, with a 6.2%
increase on average anticipated from 2011 to 2013,
following a 10% rise in 2010.
• A favorable economic context had a positive impact
on prime rents which have now been stable for 6
months (Figure 36). Prime rental values stand
between €42 per sq m in Budapest, €48 per sq m in
Bucharest, €52 per sq m in Prague and €66 per sq m
in Warsaw (Figure 36). These rents are expected to
increase by 2% in Prague in 2011 and then the
growth will spread in 2012 to Poland and Hungary.
Figure 35
GDP growth (%) in selected countries in CEE
www.dtz.com 21
%
10
8
6
4
2
0
-2
-4
-6
-8
2007 2008 2009 2010 2011F 2012F 2013F
Czech Rep. Hungary Poland
Romania Eurozone
Source: Oxford Economics
Figure 36
Prime rents in CEE
€/ sq m /
year
80
75
70
65
60
55
50
45
40
Source: DTZ Research
Budapest Prague Warsaw Bucharest

Occupiers market – Country overview
Poland
Strong occupier demand for built-to-suit
schemes
• Poland has been one of the most resilient economies
in Europe during the financial crisis of 2009 and 2010.
Its large domestic base as well as its strong position
in foreign trade has sustained the recovery (4% p.a.
increase in GDP until 2013).
• After its strong performance in 2010 with 1.5 m sq m
let, take-up has kept the same pace with 800,000 sq
m of transactions registered in H1 2011, mostly
during the 2 nd quarter (Figure 37). Market activity is
still dominated by built-to-suit schemes taken by
industrial and logistics companies.
• Greater Warsaw has seen its market share growing
over H1 2011 to reach 40% of take-up from 30% in
2010, whilst the Silesia region accounted for another
30%.
• Relatively strong demand translated into a gradual
decline of vacancy rates to 13.5% in H1 2011 from
15.3% at the end of 2010. The available modern
logistics stock amounted to approximately 900,000
sq m, which represents a decrease of over 100,000
sq m in comparison with Q4 2010. The fall in vacancy
rates should continue as speculative construction
remains limited with only 100,000 of completions in
H1 2011 and only 400,000 sq m anticipated for 2011
in total.
• In H1 2011, prime rents have remained unchanged in
the Warsaw market and stand at €66 per sq m. In the
regional markets, rental values grew slightly to €40-
42 per sq m. Going forward, the positive economic
outlook combined with an ongoing low level of new
supply should support prime rental growth in Warsaw
from 2012 (3% p.a. increase on average until 2014).
Figure 37
Take-up & new supply in Poland
1 800 000
1 600 000
1 400 000
1 200 000
1 000 000
800 000
600 000
400 000
200 000
0
2005 2006 2007 2008 2009 2010 H1
2011
www.dtz.com 22
Sq m
Source: DTZ Research
Take-up New supply

Occupiers market – Country overview
Czech Republic
Net take-up declines but rental prospects
remains positive
• The Czech Republic performed well in H1 2011, with
gross take-up close to 400,000 sq m, a level in line
with the 800,000 sq m registered in 2010. However a
large part of market activity has been concentrated
on renegotiations and renewals, thus net take-up
reached a modest level of 200,000 sq m (Figure 38).
In light of weaker occupier demand, landlords grant
lower rents in order to retain the occupation of their
buildings on a longer term.
• Apart from this phenomenon, occupiers have
continued to be selective over the quality of their new
buildings showing a limited appeal for the existing
stock. As in other countries across Europe, built-tosuit
schemes are preferred by industrial and logistics
companies for their relocation and expansion.
• The low level of immediately available supply and
longer periods of lease renegotiations on built-to-suit
projects will slow down the level of take up for the
rest of 2011.
• The vacancy rate has declined significantly, falling to
8.6% at the end of H1 2011 from 10.4% at the end of
2010. Vacancy decreased mainly in West Bohemia
and in Moravia-Silesia although only marginally, in
most other submarkets it remained stable. Until the
end of 2011 we expect to see a continuous decline of
the vacancy rate as there is currently only 242,000 sq
m of modern class-A warehouse space under
construction, of which only 31 000 sq m is not preleased.
• Headline rents for modern logistics space have
remained stable at €43-52 per sq m. It is forecast that
prime headline rents will increase towards the yearend
to around €53 per sq m.
Figure 38
Take-up & supply in the Czech Republic
1 200 000
1 000 000
800 000
600 000
400 000
200 000
www.dtz.com 23
Sq m
0
Source: DTZ Research
2005 2006 2007 2008 2009 2010 H1
2011
Gross take up Supply

Occupiers market – Country overview
Hungary
Renewals the main driver of the market
recovery
• The Hungarian logistics market has registered a
strong performance in H1 2011, as gross take-up
reached a record level of 180,000 sq m. Behind this
figure, the reality of the market shows a high level of
renewals (around 50%) whilst new lettings accounted
for only 30% of this volume (Figure 39).
Requirements for small or medium-sized buildings
are numerous, although some larger deals have also
been registered.
• 2010 has seen companies in the light
industry/assembly sector accounting for 34% of
annual take-up. In H1 2011 the logistics sector has
been dominant, accounting for 56% of total
transactions.
• Despite the fact that there were no completions of
vacant buildings in H1 2011, the vacancy rate has
continued to increase to reach 21.8%. Several larger
industrial units and the former Spar distribution
centre (43,000 sq m) have become vacant.
• We don’t expect any major changes to the market in
H2 2011, as the consolidation trend of occupiers,
seen since the beginning of the year, will continue.
However the vacancy rate should start to decrease,
as construction activity of speculative schemes is
mainly frozen.
Romania
Still challenging but a little bit better…
• Mainly characterised by medium-sized requirements
(from 3,000 to 5,000 sq m), the Romanian logistics
market has been strong during the first half of the
year with an estimated 150,000 sq m taken up (for
both class A and B facilities), of which 100,000 sq m
was transacted in Bucharest. The largest deals done
over the period were by a local IT distribution
company ASE SOFT in Bucharest on approx. 9,000
sq m of storage logistics space and a 13,000 sq m
built to suit deal signed in Ploiesti, by the American
irrigation company Toro.
Figure 39
Take-up & new supply in Hungary
www.dtz.com 24
Sq m
350 000
300 000
250 000
200 000
150 000
100 000
50 000
0
Source: DTZ Research
Take-up New supply
• However, the second part of the year should follow a
similar trend with industrial companies searching for
premises between 5,000 and 10,000 sq m in
Bucharest and other secondary cities.
• Amongst developers and investors active in Romania,
cautiousness is still required and a return of
speculative projects is not expected until 2012/2013.

Occupiers market – Country overview
Ukraine
New building development is still frozen
• While GDP growth could still be close to 5% this year,
downside risks are growing as the main export
markets slow and gas import prices continue to rise.
The mixed picture of the Ukrainian economy explains
the wait-and-see attitude of investors and developers.
• Construction activity is still frozen but the return to a
stronger market will require a firmer recovery in
demand. Meanwhile occupiers seeking space
remain cautious, therefore current levels of
occupancy, despite lack of new development, will
remain generally stable throughout 2011.
• Prime warehouse rents vary between €47 per sq m
and €57 per sq m, depending on quality. Although
there has been a change in the demand/supply
balance, current forecasts are for rents to remain
generally unchanged in the short term.
Russia
Strong demand in Moscow
• The logistics market in Russia is structured around
the international corridors and roads (M10 /
Leningradskoe in the North West, M3 / Kievskoe, in
South West, MA and M2 in the South). Moscow and
its suburbs are the main market in Russia. Land
around the city of Moscow is currently the most
attractive region in the country for the logistics sector
due to the availability of land and the proximity of the
national and international corridors to Southern
Russia, Ukraine and the Black Sea ports.
• The logistics stock in Moscow is estimated at 6.3
million of sq m, including 3.5 million of Grade A
space. After its peak in 2009, the vacancy rate has
declined rapidly to 10% in 2010 and only 3% of
vacancy is expected at the end of 2011. New supply
is still limited while the demand of retailers and
manufacturing companies has remained dynamic.
• In this context, prime rents have increased since
2010 to reach $120-135 per sq m per annum in
Moscow and $150-160 inside the city.
Figure 40
Logistics rents in Moscow
US $
per sq m
www.dtz.com 25
150
140
130
120
110
100
90
80
Source: DTZ IMS Research
2006 2007 2008 2009 2010 2011F
Grade A Grade B

Occupiers market – Country overview
Middle East - Dubai
Limited market activity in H1 2011
• In terms of scale, Dubai dominates the logistics
sector in the UAE and is likely to do so for the
foreseeable future. This is primarily because the
major infrastructure is already in place and Dubai is
seen as a regional hub over and above servicing the
domestic market. This situation is illustrated by the
fact that the majority of the logistics operators (parcel
couriers and 3PLs) use Dubai as their regional hub.
• There is approximately 2 m sq m of “good quality”
logistics warehouse stock in Dubai. There is a
significant amount of lesser quality stock on the
market located throughout the established industrial
areas; however it is difficult to confirm the total stock
figure for this type of product. The majority of good
quality stock is within Jebel Ali Free Zone (JAFZA)
with a substantial proportion in the Dubai Airport Free
Zone (DAFZA) and Dubai Investment Park. This
trend is expected to continue as JAFZA and the
newer industrial areas within southern Dubai are
likely to become the dominant warehouse locations in
the medium term with the opening of the new Al
Maktoum airport and the existing interface with the
Jebel Ali port.
• Rents in Dubai have been subject to downward
pressure since late 2008 with this trend set to
continue for poorer quality accommodation in
secondary locations. However, signs of stability have
been witnessed in recent months with logistical
fundamentals prevalent in the Emirate providing
stability for better quality and well located stock.
• Limited rental activity for larger industrial complexes
within the Ras Al Khor area has been noticed in H1
2011. We are aware of the letting of a brand new
industrial facility of 14,000 sq m including 929 sq m of
office accommodation situated in Ras Al Khor 1 for
AED 3,250,000 pa net plus 15% tax. The rental
transaction reflects a rent of AED 237 per sq m over
total building area and a good indication of high
quality, larger complex industrial rental rates within
the surrounding area (Figure 41).
Figure 41
Prime rents in Dubai
AED
per sq m
Umm Ramool
DAFZA
Al Qusais
Al Quoz
DIP
Jebel Ali
Ras Al Khor
DIC
Dubai Silicon Oasis
JAFZA
DLC
Source: DTZ Research
0 200 400 600 800 1000 1200
www.dtz.com 26

www.dtz.com 27

Definitions
Availability: Marketed space (usually available to move into within 6 months) that may or may
not be vacant.
Availability ratio: Industrial space currently available as a percentage of stock.
Newly available: Floor space placed on the open market including both developments within six
months of completion and units of second-hand space.
Stock: The latest commercial industrial floor space statistics (warehouses).
Building grade: Grade A: newly developed or comprehensively refurbished to new standard,
including sublet space in new/refurbished buildings not previously occupied
Grade B: buildings of good specification, floor plate efficiency and image usually
but not exclusively ten years old or less
Grade C: remaining poorer quality stock
Speculative development: A newly developed or comprehensively refurbished building undertaken without
the benefit of a secured tenant.
Development start: A development in which work has started on the main contract. This usually
excludes demolition and site clearance contracts.
Development completion: A development in which the main contract has been completed, whether this be
to shell and core or developer's finish.
Take-up: Occupational transactions, including the following:
(i) industrial buildings let/sold to an eventual occupier that had not been
previously recorded as under offer to that occupier
(ii) developments pre-let/sold to an occupier
(iii) owner occupier purchase of a freehold or long leasehold
Prime rent: The rent reported being paid, which may not take account of concessions such
as rent-free periods, in which case it is known as the effective rent.
www.dtz.com 28

Contacts
Eurologistics Group
Robert Hall +44(0)20 3296 2076 robert.a.hall@dtz.com
Belgium
Dirk Van Bulck +32 3303 1020 dirk.vanbulck@dtz.com
Czech Republic
Martin Sumera +42 0234 262 222 martin.sumera@dtz.com
Denmark
Tom Nedergaard +45 3314 5070 tom.nedergaard@dtz.com
France
Lionel Garde +33 472 74 08 89 lionel.garde@dtz.com
Germany
Willi Weis +49 69 92 100 253 willi.weis@dtz.com
Hungary
Éva Tamás +36 1 472 7276 eva.tamas@dtz.com
Italy
Manuela Miller +39 02 77 22 99 22 manuela.miller@dtz.it
Ireland
Brendan Smyth +35 3163 99380 brendan.smyth@dtz.ie
Netherlands
Gerwin Vos +31 10 4 333 555 gvos@dtz.nl
Middle East
Nick Witty 974 4 483 7395 nick.witty@dtz.com
Poland
Erik Drukker +48 22 222 3000 erik.drukker@dtz.com
Russia
Andrey Zhernokleev +7 (495) 748 1111 andrey.zhernokleev@dtzims.ru
Spain
Manuel Hurtado de Amézaga +34 91 770 9601 manuel.hurtado@dtz.com
Sweden
Maria Krumlinde +46 8671 3493 maria.krumlinde@dtz.com
United Kingdom
Simon F Lloyd +44 (0)12 1697 7392 simon.f.lloyd@dtz.com
Ukraine
Irene Zalizenko +38 044 220 3072 irene.zalizenko@dtz.kiev.ua
www.dtz.com 29

www.dtz.com
Disclaimer
This report should not be relied upon as a basis for entering into transactions without
seeking specific, qualified, professional advice. Whilst facts have been rigorously
checked, DTZ can take no responsibility for any damage or loss suffered as a result of
any inadvertent inaccuracy within this report. Information contained herein should not,
in whole or part, be published, reproduced or referred to without prior approval. Any
such reproduction should be credited to DTZ.
© DTZ September 2011