According to consultancy firm Savills, the amount of open-air industrial and logistics warehousing space is set to increase significantly on the Old Continent.

According to the latest "Spotlight, The Emergence of Industrial Outdoor Storage in Europe" report, property consultancy Savills expects significant growth in industrial and logistics outdoor storage (IOS) space in Europe, with investment set to increase by 4.5% year-on-year over the next five years.

The IOS provides space and facilities for companies that need to store goods, equipment or vehicles outdoors. Located in industrial areas, industrial estates are characterised by a large amount of open land, with typical coverage rates ranging from 20% to 40%.

Although the IOS market varies from place to place and is affected by factors such as local regulations, connectivity and economic conditions, there remains untapped potential across Europe.

A number of factors point to future growth in this sub-segment. Firstly, the growth of e-commerce on the Old Continent has created a need for additional space, particularly to manage seasonal fluctuations. Then there are the vehicles needed for same-day and next-day deliveries.

Other factors include businesses that rely on large equipment requiring outdoor storage solutions and companies' desire to strengthen their supply chains following the coronavirus pandemic.

Savills therefore believes that IOS represents an attractive investment opportunity, particularly at a time when demand for storage space is set to increase against a backdrop of tight supply. The consultancy also expects considerable growth in rents, which have already rebounded by 47% per annum in the UK between now and 2023.

Savills sees IOS as a major opportunity for all European property markets and expects transaction volumes to increase significantly as investors look to add to their portfolios. These assets are also likely to play an important role in the energy transition, as they could be suitable for storing electric vehicles and batteries.

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