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Newsec Property Outlook: The Nordics – an undersupplied logistics market

Max Barclay, Head of Newsec Advisory

In the latest edition of the Newsec Property Outlook, Newsec has identified a number of key insights about industrial real estate in the Nordics. Newsec can conclude that the Nordic logistics market is undersupplied and that strong interest from international investors will continue to push down yields.

Despite rising demand from investors, there continues to be a large undersupply of modern logistics that meets today’s demands in the Nordics. The lack of speculative construction and general requirement among many players for a large portion of space to be pre-let prior to projects being commenced, combined with strict planning constraints has resulted in supply being held down relative to the rest of Europe. At the same time, there is enormous potential and interest in the segment.

“Logistics is the most borderless asset class and as the Nordics is the third largest market in Europe, after the UK and Germany, this creates great opportunities for investors active in the region. For instance, our analysis shows that compared to the rest of Europe, significantly less logistics buildings have been developed in the Nordics, even per capita”, said Max Barclay, Head of Newsec Advisory.

Geography and long distances between population centres suggests that the need for new logistics space in the region is substantial. Though a record amount of new development is expected in 2021 – 800,000 sqm in Sweden (similar to the amount set to come to the UK in 2021), 350,000 sqm in Norway, 300,000 sqm in Denmark, 200,000 sqm in Finland – it will take some time for the older existing stock to be replaced by property with higher specifications and sustainable standards.

At the same time, investor appetite for logistics continues to rise and a relative lack of modern supply as well as competition between investors could serve to push down yields further. The yield gap between office and logistics has tightened substantially over the past five years, from 200 bps to sub 100 bps – and will tighten further.

“2021 will be the strongest year for the transaction market in the Nordics of all time – partly driven by strong investment into the logistics segment. Newsec’s data shows that industrial is by far the most popular real estate segment amongst foreign investors in the Nordics. International investors account for more than half, 61 percent, of the industrial transaction volume”, said Max Barclay, Head of Newsec Advisory.

Access the full report at

About the report
The Newsec Property Outlook has been published twice a year since 2001. The free report describes and forecasts the real estate market in Northern Europe, with a focus on the Nordic and Baltic countries. The report has come to be a handy tool for investors, property owners and tenants.

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Annika Wahlund Head of Press, Newsec Advisory
Max Barclay Head of Newsec Advisory