This year, the vacancy rate for logistics centers in the metropolitan area slightly decreased compared to the previous quarter.
According to CBRE Korea on the 15th, the vacancy rate for the A-class logistics center market in the metropolitan area is expected to be about 22%, a decrease of 1 percentage point compared to the end of last year. A-class logistics centers in the metropolitan area refer to logistics centers with a total floor area of over 33,000 square meters located in Seoul, Gyeonggi, Incheon, and other areas.
Since the outbreak of the novel coronavirus (COVID-19), the oversupply of logistics centers in the metropolitan area has been gradually decreasing.
According to Al Square, a comprehensive service corporation in commercial real estate, the new supply of logistics centers in the metropolitan area in the second half of last year was recorded at 1.914 million square meters (based on total floor area). This is a 4.9% decrease compared to the first half of last year.
In the case of A-class logistics centers in the metropolitan area, it is analyzed that the vacancy rates are gradually decreasing as lease contracts are being actively signed.
According to CBRE Korea, the lease volume for A-class logistics centers in the metropolitan area this year in the first quarter is about 178,025 square meters. In the western metropolitan area, Coupang has leased the entire area (about 49,000 square meters) of the Incheon Dohwa logistics center. Market Kurly has renewed the lease contract for its logistics center located in Gimpo.
In the southern metropolitan area, companies such as LOTTE Global Logistics, Ace Korea, and YJ Logistics have been relocating their facilities primarily around Ansung, Icheon, and Yongin.
The home living sector is also experiencing a continuous increase in rental demand. Following the opening of a third logistics center by Ohouse at the end of last year in Yeoju, the Japanese furniture and interior distribution company Nitori has newly leased 14,000 square meters in Ansan in the first quarter of this year.
A representative from CBRE Korea noted, "The logistics center market in the metropolitan area will see a gradual decline in vacancy rates in line with the decrease in supply," but he added that "it will take some time until the vacancy rates stabilize."
In the first quarter of this year, four new A-class logistics centers were supplied, totaling 221,546 square meters. Notably, the Gayuri logistics center in Ansung, with an area of 96,027 square meters, accounted for 43% of the total supply in the metropolitan area in the first quarter.
The Hwaseong FC Sinheung logistics center (45,724 square meters) was also completed in Hwaseong, Gyeonggi Province. The Yangju Composite Logistics Center (44,017 square meters) and the Daeseongri Logistics Center (35,778 square meters) were also supplied in the first quarter.
About 30% of the new logistics centers supplied in the first quarter have found tenants upon completion.
Kuehne+Nagel, a German global third-party logistics (3PL) company with Adidas as a client, is using three floors (about 69,500 square meters) of the ambient temperature space in the Gayuri logistics center in Ansung, Gyeonggi Province. For the Yangju Composite Logistics Center, discussions are currently underway for specific negotiations regarding two floors of ambient temperature and half a floor of cold storage (about 20,000 square meters) with certain companies.