Commercial Real Estate News
Demand for Logistics Space at Global Seaports Booms
Shanghai, Singapore, Los Angeles and Hong Kong ports top global list in 2022
According to the recent CBRE Global Seaport Review, a 36.5% jump in international shipping container volumes over the past decade is driving strong demand for logistics space near seaports. The twin catalysts behind this increase are e-commerce sales growth and increased inventory holding to guard against supply chain disruptions.
The industrial and logistics sector has seen historically high demand as companies expand their real estate footprints to keep up with e-commerce sales that have increased 133% over the last five years. It's anticipated that by 2026, 1.7 to 2.2 billion square feet of additional e-commerce-dedicated logistics space will be required to support internet sales.
Companies are challenged to find warehouse and distribution space to meet growing demand while keeping shipping costs in check. The CBRE Supply Chain Advisory group estimates that transportation accounts for 45% to 70% of total logistics costs. Locating distribution facilities near seaports can help to lower transportation costs.
Trade volumes are also growing rapidly amid an increasingly global consumer landscape. Seaports have evolved over the decades with the adoption of container shipping, the diversification of cargo types and equipment, better intermodal transportation of containers and advancements in port technologies. Today, global seaports distribute on a large scale, enabling shipping companies to take advantage of economies of scale and reduce costs.
"A greater number of companies today are facing the enormous supply chain pressures generated by changing consumer behavior, economic uncertainty and a need to better insulate their manufacturing and distribution processes from interruptions," said John Morris, CBRE President of Industrial & Logistics in the Americas. "As container shipping increases, so does the need for more logistics real estate, especially within seaport markets."
Among the 18 global ports ranked by TEU volumes include:
