After more than a decade of consistent growth, global logistics real estate rents declined by 5% in 2024 as market conditions normalized after historic growth during the pandemic. An influx of new supply—coupled with positive but subdued demand rooted in economic, financial market and supply chain uncertainty—pushed vacancy rates up in most markets across the globe.

In Europe, net effective rents declined 1% y/y for the first time since 2010. Headline rents remained stable in most markets because recent deliveries started at peak pricing in 2022, incentivizing developers to hold firm to achieve planned margins. But rising vacancies (4.8% as of Q4 2024, up 100 bps y/y), particularly in supply-heavy markets like Poland and Hungary, resulted in increased concessions. Upward movement in free rent reduced net effective rents by 1% (Southern Europe) to 4% (Central Europe) during 2024. High-barrier markets, such as France and Germany, fared better because of low vacancy and constrained supply. Soft demand, influenced by economic headwinds and geopolitical risks, could weigh on 2025 performance. Limited new supply and high replacement costs, however, should support rental rate increases in late 2025.

The top 10 rent growth markets in Europe are:

Bratislava
Utrecht
Paris
Rome
Greater Milan
Amsterdam
Madrid
Greater London
Midlands
Berlin

The global development of rents is driven by five trends: 

Trend 1: Uncertainty pushes decision-making into 2025.

Trend 2: Flight-to-quality boosts Class A rents.

Trend 3: Oversupply risk fades further.

Trend 4: Replacement cost rents moved further above market rents.

Trend 5: Market rents decreased 2% globally in 2024, excluding Southern California.  


More information about the five trends and further regional highlights can be found here:
https://www.prologis.com/insights/global-insights-research/2024-market-rents-reset-after-years-outperformance