Sydney, NSW, Australia

Industrial markets around the world are beginning to feel the effects of the global slowdown, however the Asia Pacific region has remained relatively strong, according to the findings in Colliers International’s Midyear 2008 Global Industrial report.

Colliers International Commercial Research Director Felice Spark said the report, which covers 166 markets across Europe, the Middle East, Africa, North America, Latin America and Asia Pacific, found European economies registered a noticeable slowdown in the first half of 2008 with the euro-zone and UK posting very sluggish growth.

“As anticipated, U.S. and Canadian warehouse markets registered more sluggish results during the first half of 2008 compared with 2007; however, Canadian markets, and particularly those in western Canada, continued to operate above trend,” Ms Spark said.

The research found Asia Pacific region was the growth leader for the first half of 2008, with China and India leading the way.

“This same pattern is expected to continue for the balance of 2008 and into 2009; although with global economy slowing even the Asia Pacific region will post slower growth,” said Ms Spark.

The research found port cities remain very active as intra-region trade remains relatively robust.

Warehouse rents in the region vary significantly with Japanese markets, Hong Kong, Seoul and Singapore all posting lease rates in excess of $USD 15.00/sf/year.

Asia Pacific land prices ranked number one and two in the world with Hong Kong at $1,024 per square foot, Seoul at $625 per square foot and Tokyo’s Ariake submarket at $416 per square foot.

London's Heathrow submarket was found to be the most expensive warehouse space in the world.

The report found that European warehouse markets continued to show steady growth, albeit down from 2007 levels.

Spain, The Netherlands, Austria, Belgium, Sweden, Denmark and the UK are all anticipating
higher yields (lower prices) in the coming months.

For the rest of the EMEA region, however, solid fundamentals are expected to leave yields steady and in some cases possibly decline.

Europe is also home to some of the most expensive warehouse rents in the world with London’s
Heathrow submarket holding the title for the most expensive warehouse space in the world at
$26.92 per square foot per year (₤13.50 per square foot per year).

According to the research, as the U.S. economy continues to cool leasing activity is expected to show a further decrease as the effects of a depressed housing market filter through the general economy.

Reflecting relatively sound fundamentals, however, Colliers International predicts most North American markets should see rents either hold steady or decrease just marginally in the coming months.

About Colliers International

Colliers International is a global affiliation of independently owned commercial real estate firms. The organization's 10,092 employees span the world in 267 offices in 57 countries. On a worldwide basis, Colliers manages 672,945,918 square feet, and has revenue of $US 1,620,958,349.

Contact Information

Phoebe Miller
National Communications Manager
Tel:  02 9257 0276
Mob: 0402 547 484
Phoebe.Miller@colliers.com

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