CBRE Survey Reveals Logistics Occupiers Plan Strong Expansion in APAC Amid Supply Crunch

Real Estate News Monday October 18, 2021 16:58 —PRESS RELEASE LOCAL

CBRE Survey Reveals Logistics Occupiers Plan Strong Expansion in APAC Amid Supply Crunch

A new CBRE survey has found that logistics occupiers have big plans to expand their warehouse footprint in Asia Pacific over the next three years on the back of growing optimism about the operating environment.

The survey polled nearly 100 senior decision makers overseeing the real estate logistics portfolios in companies ranging from third-party logistics (3PLs) to manufacturers, e-commerce platforms and retailers. It found that 78% of logistics occupiers intended to expand their warehouse portfolio, with slightly more than half of respondents eyeing significant growth. Emerging markets in Southeast Asia, such as Thailand, Vietnam, Indonesia and the Philippines are growth targets.

Heightened demand comes amid a drop in warehouse vacancy in major Asia Pacific markets to less than 4% in Q2 2021. Net warehouse absorption in major Asian markets also reached its highest first-half figure on record at 3.3 million sq.m. in H1 2021.

Underpinning these expansion plans, occupiers are optimistic about the operating environment, with 84% expecting significant or moderate improvement over the next three years. Their optimism is supported by the logistics sector's resilient performance throughout the pandemic, fueled by accelerating e-commerce expansion, growing omnichannel retail and increased supply-chain requirements, such as maintaining additional inventory, or safety stock.

Mr. Adam Bell, Head of Transaction and Advisory Services - Industrial and Logistics, CBRE Thailand comments, "Prospects look bright for Thailand's logistics properties with strong drivers like the growth of e-commerce and online retailing platforms. But balancing this optimism is the ongoing pandemic situation and the travel restrictions that are currently in place. Until these restrictions are eased, we do expect the level of investment activity in the market to remain at a minimum. CBRE believes that Thailand continues to be in a strong position to attract investors in APAC, but its offerings should also evolve and improve to meet the demand of the new industries coming in. In this respect, the infrastructure development in and around the Eastern Economic Corridor (EEC) area will be crucial for its ongoing success."

"The pandemic has helped to hasten the pace of e-commerce growth and changed consumer buying behaviours, in turn shaping the logistics landscape of tomorrow. Networks that rely on more direct and near-urban connection points are supplanting traditional multi-tier systems. This means that logistics property expansion in the next few years will be characterised by more demand for capacity closer to end-customers as shorter delivery times become increasingly crucial in an omnichannel era," said Mr. Troy Shortell, Head of Supply Chain Advisory, Asia, at CBRE.

Optimising growth and costs

Costs have come sharply into focus for logistics occupiers in recent years as the omnichannel distribution model increases the complexity and frequency of deliveries and drives costs higher. The survey found that increased cost for fuel, transport and labour was the biggest concern from 61% of occupiers, ahead of pandemic-related impacts (51%) and economic uncertainty (50%). Real estate rent emerged as one of the top three factors occupiers consider when deciding where to locate facilities, alongside proximity to transportation, and proximity to markets and consumers.

The focus of logistics expansion is shifting from prime locations to satellite cities adjacent to metropolitan areas. Nearly 70% of occupiers surveyed expect to use more facilities in satellite cities, which often can be let for up to 50% less compared with prime locations. These secondary locations also offer high quality logistics space for expansion and consolidation. Occupiers have been quick to secure space, leading to vacancy in satellite locations such as Ken-o-do in Greater Tokyo falling from nearly 20% in 2017 to just 0.7% in Q2 2021.

Next generation logistics facilities

CBRE's survey found that logistics occupiers with an eye on keeping costs low, while increasing efficiency and handling capacity, will have certain expectations for newer logistics facilities. These include requirements for facilities with green certificates or sustainability features (69%), chilled or frozen storage space (60%) as a result of omnichannel grocery retail demand, and multi-story facilities with ramp-up access that offer enhanced space utilisation (58%).

"Modern logistics operations are changing, and so the next generation facilities will need to evolve to meet new requirements. Well-designed warehouses with higher ceiling heights, wider column grids, ample dock space, and direct access are already becoming some of the most sought-after features by logistics property occupiers," added Mr Shortell.

About CBRE Group, Inc.
CBRE Group, Inc. (NYSE: CBRE), a Fortune 500 and S&P 500 company headquartered in Dallas, is the world's largest commercial real estate services and investment firm (based on 2020 revenue). The company has more than 100,000 employees serving clients in more than 100 countries. CBRE established an office in Bangkok in 1988, followed by its Phuket office in 2004. CBRE serves a diverse range of clients with an integrated suite of services, including property sales and leasing; investment management; appraisal and valuation; strategic research and consulting property management; facilities, transaction and project management. Please visit our website at

เว็บไซต์นี้มีการใช้งานคุกกี้ ศึกษารายละเอียดเพิ่มเติมได้ที่ นโยบายความเป็นส่วนตัว และ ข้อตกลงการใช้บริการ รับทราบ