The Last Mile: the Western Phenomenon, Placing the Most Sought-After Warehouses in the City

In big cities in the USA, England, and Germany, the most hunted industrial spaces are the logistics spaces inside the city as close as possible to the end consumer of e-commerce (online sales) and delivery companies, called last-mile

The battle for these deposits is between Amazon and the delivery companies (such as UPC, FedEx) that deliver for their competition, all other major retailers on the market, who want to bring the products as soon as possible – in a few hours or maximum one day. 

This race against the clock can be won only if the most requested products are already in small warehouses, in the heart of the city, which leads to a lot of pressure on the market segment of industrial spaces in the city, at all key points, where the most extensive urban agglomerations are, according to an analysis made by SIOR (SOCIETY OF INDUSTRIAL AND OFFICE REALTORS®)

 In London, rent of last-mile, proximity deposits have risen by 20-30%. In the last three years, the highest demand for such spaces comes from Amazon, which delivers the products within a few hours of placing the order on the site.

For good spaces in London, rents of 18 euro/sqm/month are also practiced, a tariff per sqm closer to that of the office market, than that of industrial spaces, due to low supply.

As solutions to increase the supply of last-mile spaces, these proximity deposits, SIOR specialists identified the construction of multi-stored spaces to be competitive with residential developments, but also the reconversion of some commercial spaces or unused common spaces in some residential complexes.

“In Romania, for now, we have an inverse phenomenon, the removal of deposits from the city, as a result of current legislation, but there will come a time when competition between online sales companies (from computers to consumer products) lead to an increase in demand for such last-mile spaces. Those who will secure the best locations as soon as possible will benefit from the highest delivery speed “, estimates Alexandru Petrescu, Managing Partner of ESOP Consulting at CORFAC International.

Jokingly or not, the american real estate analyst Norm Khoury says, “Amazon will surround us.”

If you would like more information about the industrial spaces for rent in Bucharest and Ilfov, please contact the ESOP team by filling this brief form, or by phone (+4) 0723.26.61.97 or (+4) 021.528.04.40. We’ll promptly answer your inquiry!

Photo source:

Alexandru Petrescu

Founding Managing Partner of ESOP Consulting | CORFAC International with 20 years of experience in real estate consulting and entrepreneurship.

Postari similare

Green Spaces Have Become the Most sought-after Amenities Offered by Business Parks

Even though the pandemic crisis has slowed the pace of construction of new office buildings, those delivered during the pandemic, or which are now under construction, have adapted to the new demands from tenants. As a result of the cessation of the state of alert starting with 09.03.2022 and the revocation of the restrictions for […]

Read more

Consolidare versus atomizare pe piata de birouri

Consolidation versus “atomization” on the office market due to COVID 19

What will companies do in the post-COVID-19 period? Will they return to the consolidation strategy, namely placing the entire company under a single roof, be that an office building or a business park? Or will they choose to “atomize” them through Work from Home or Work Near Home? Or will they adopt a hybrid strategy […]

Read more

WDP Stefanestii de Jos

WDP Ștefăneștii de Jos Expands in “Build to Suit” System

One of the best received by the market industrial parks in Romania is WDP Ștefăneștii de Jos, which came to have all the halls built occupied, in only two years from the start of the works. The upper class A logistics project, located near Bucharest, is being developed in two stages: WDP Ștefăneștii de Jos […]

Read more