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Germany's logistics letting market delivered a strong first quarter in 2026 — stronger, in fact, than the broader economic picture might have suggested. That was the opening message from a recent webinar attended by REFIRE in which four logistics real estate specialists offered a candid and occasionally surprising assessment of where the market stands and where it is heading. The headline conclusion: the easy phase of rental growth is over, but the structural demand story remains firmly intact, driven increasingly by forces that barely existed two years ago.
Dr. Tobias Kassner, Head of Research at GARBE Industrial Real Estate, set the macro framework. Energy prices, geopolitical volatility, Iran-related supply chain disruption and renewed pressure on interest rates are all creating headwinds for occupier demand — while simultaneously generating new requirements on the other side of the ledger. Safety stocks, buffer warehousing, resilient supply chains, regionalised logistics networks: each successive shock reinforces the case for more, not less, logistics capacity. Construction costs, which had been expected to fall gently back towards 2020 levels by 2030, are now forecast to rise by a further 6% instead, compressing new supply and keeping the development pipeline tight.
The German market recorded 6.1 million square metres of take-up in 2025, a meaningful improvement on the subdued 2024 figure, with the final quarter of 2025 and the first quarter of 2026 both showing particular strength. Kassner was careful not to overstate the picture — take-up has normalised rather than recovered to the pandemic-era peaks — but the direction is clearly positive.
New players, new geographies
Michael Marcinek, Head of Development at GARBE Industrial, described Q1 2026 as "thoroughly positive," with large-format lettings and strong demand from sources that are reshaping the market's traditional geography. Three demand drivers stood out: the steady return of e-commerce to stable annual growth of around 5%, the arrival of Asian, and specifically Chinese, e-commerce players in significant volume, and the early signs of defence-sector requirements beginning to translate into real estate demand. All three are pointing at similar locations, with the Ruhrgebiet emerging as the primary beneficiary. "The old logistics banana is still there," said Marcinek, referring to the established corridor of Hamburg, Frankfurt, Munich and Stuttgart, "but the Ruhrgebiet is where we are seeing very strong demand right now, driven by Asian players."
Gerhard Lehner, Head of Germany at Savills Investment Management, confirmed the picture from the perspective of a pan-European portfolio of around 7 million square metres across 200 assets. Vacancy in the Savills logistics portfolio is effectively zero, with re-letting consistently achieved either with incumbent tenants or through new occupiers stepping into spaces vacated by third-party logistics providers. The one area of nuance was smaller urban units serving SME occupiers, where Lehner noted that weaker economic conditions are creating more friction than for large-format space. Eastern Germany, particularly in regions where automotive dependency is weighing on demand, requires more effort.
Maximilian Tappert, Head of Transaction Management Logistics at HIH Invest, offered the most precise rental market assessment. HIH currently holds 43 to 44 logistics assets in Germany and the Netherlands, with near-zero vacancy across the portfolio. But Tappert was direct on rents: the era of large step-changes is over. "We believe the rental development has stabilised and will remain at this level." Headline rents are broadly flat, but the effective story is softening. Landlords are now offering meaningfully more incentive packages, rent-free periods and other concessions than they were one to two years ago. In a market where supply exceeds demand across the board, competition for occupiers is intensifying even where vacancy numbers look benign.
Defence, data centres and the future of demand
Two emerging themes generated the sharpest discussion. On defence, both Marcinek and Tappert described a genuine but operationally demanding new occupier type. Defence-related tenants require standalone buildings, minimal gate configurations for security reasons, perimeter fencing and surveillance infrastructure. Multi-tenant assets are effectively off the table. The practical response from developers is to design buildings with defence occupiers in mind while retaining the ability to retrofit standard logistics features if and when those tenants eventually vacate. As Tappert put it: "For us, it is always important that if the tenant moves out, the building must also be usable for the largest possible user group. That is the focus."
On data centres, the discussion revealed a competitive dynamic that is quietly reshaping land markets in key logistics clusters, most notably Frankfurt. Data centre developers are paying land prices that are simply incompatible with logistics economics. At sites where both uses are theoretically possible, logistics is increasingly losing out. Kassner observed that where data centre clusters develop, correlated demand for logistics space, spare parts, after-sales supply chains and maintenance operations, will follow. But the land competition is real and is already constraining new logistics development in some of Germany's most important markets.
Looking ahead, the panel's consensus was measured but genuinely constructive. Logistics remains, in Lehner's assessment, one of the three asset classes alongside residential and food-anchored retail that continue to attract sustained institutional investor interest even as equity capital remains scarce. The structural demand drivers are intact. Rental growth will be modest. The geopolitical environment makes forecasting unusually difficult. "Our business is very solidly positioned," Kassner concluded, "and there are good reasons to believe that will continue — as long as industry recovers its footing and generates the underlying demand our sector depends on."