Bigger Ships Increase European Logistics Demand

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Warehouse space in Europe is expected to grow by 40 to 60 percent by 2030 to accommodate the growth in global world trade, according to a new report from Jones Lang LaSalle. 

The growing demand will increase warehouse and logistics real estate by 20 to 30 million square meters in the next 16 years as a response to changing maritime trade patterns, including larger container ships, increasing global container throughput and changing distribution channels, the firm said. 

"Port-centric logistics is increasingly coming into the spotlight as it offers a number of substantial benefits such as reduced transport costs, faster delivery times and less environmental impact through reduced road travel,"  Phil Marsden, EMEA head of logistics & industrial, JLL said in the report. 

"Growth in maritime transport will put pressure on European governments, local municipalities and port owners/operators to provide the required capacity and logistics infrastructure to support this expansion." 

European port throughput volume is expected to grow from 95 million TEU in 2012 to approximately 150 million TEU by 2030, an increase of 50 percent. The substantial increase in warehouse space will be seen in ports that had a throughput of more than 500,000 TEU in 2012, JLL reports. 

Container ships continue to increase in size, while only 20 European seaports currently offer the accessibility required. 

"Seaports are increasingly competing which each other to attract or retain shipping lines and cargo owners,"  Alexandra Tornow, EMEA logistics & industrial research, JLL, said in the report. "Ports will increasingly see their competitive advantage defined by access for the larger ships along with efficient multi-modal hinterland connectivity, allowing for efficient storage and onward distribution of cargo along with economic growth in a port's direct hinterland."

A similar growth in logistics space is being witnessed in other major markets. The expansion of the Panama Canal, which will increase the number of Panamax-class container ships to the port of Miami in 2015, is among other catalysts for the growth of warehouse space for the city.