Global warehouse leasing market to reach $107.44bn by 2025

Global warehouse leasing market

The global warehouse leasing market is expected to reach USD 107.44 billion by the end of 2025, according to the latest report by HEXA Research.

The market is primarily driven by the increasing demand for leasing derived from third party logistics, manufacturing & engineering companies, FMCG and e-commerce companies in developed economies such as the U.S. and UK.

The increasing collaboration for the technological advancements among the leading players such as JLL and CRBE Inc. is primarily driving the demand for the warehousing leasing market. However, the manufacturers are also focusing on the proptech services to increase the development factors in the industry with the help of new technologies.

The commercial market is influenced by the growing demand from the e-commerce, manufacturing, retail and third-party logistics companies and is expected to drive the market growth over the forecast period. These activities for the warehouse and storage facilities in major cities of the U.S. were up by 45% in the first quarter of 2018.

However, the e-commerce and the third party logistics sector witnessed a high growth as compared to the food & beverage and manufacturing sector in the region. In 2017, the leasing space in the U.S. increased by 45% to 10 million square feet due to high demand from the retail, e-commerce and manufacturing units of the companies.

global warehouse leasing market
Source:Hexa Research

Asia Pacific warehouse leasing market to remain stable..

The Asia Pacific warehouse leasing market is estimated to account for about 23.88% of the global market in 2017. The market demand for storage and warehouse leasing generated by the Asia Pacific countries such as China, Japan, and Hong Kong are mainly driven by the increasing advancements in the construction and retail sectors in the region.

The leasing activities in China is at a remarkable growth and is seen as a driving factor for the domestic economy. The automobile leasing market in China is so vast that the loans and leasing patterns acquire around 40% of the vehicles in China by consumers.

Vendors in the market are focusing on providing real estate technologies and advancements in the market. This helps to increase the market profitability of the players. The proptech provides significant developing technologies to innovate new ideas for the efficiency of the firm. For instance, Openbox provided automation services to the real estate companies for the quick delivery using the Raas (Robots as a service) model.

SEE ALSO : Global real estate investment volumes reach $1.75tn in 2018

Leverton provides real estate document services through AI-powered algorithms. This provides a platform to extract relevant information from the documents for the leasing transactions. The rising number of construction activities and the increasing demand by the consumers in the retail and third-party logistics has increased the competition in the market, thereby favoring the market growth. For instance, in 2017, the construction spending in the US was around USD 1,192 billion and is forecasted to rise to USD 1,426 billion by 2020 growing at a CAGR of around 4% over the forecast period.

The companies operating in the global industry are focusing on initiatives with the aim to develop new technological advancements and expand application areas. Companies continue to integrate technology and components for the expansion of existing services.

For instance, in 2018, Cushman & Wakefield advised Ingram Micro for the acquisition of a 0.2 million square feet warehouse from Prologis Developments for a quality logistics space. Some of the key manufacturers in the market include CBRE Group, Inc., Jones Lang LaSalle Incorporated, Colliers International Group Inc., NAI Global and Newmark Grubb Knight Frank (NGKF).

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