Prologis Signs 2 Build-To-Suit Agreements in Europe
- Mar 18, 2014
Demand for state-of-the-art industrial space across Europe is keeping Prologis Inc. busy. The global industrial real estate operator and developer recently signed two new agreements for build-to-suit projects totaling 244,000 square feet in the U.K. and Poland.
Prologis will develop a 123,000-square-foot facility for high-tech manufacturing concern SEM in Dartford, England, less than 20 miles east of London. The building will be located at The Bridge, a 264-acre project that Prologis is developing in a joint venture with the Dartford Borough Council.
In a second transaction, Prologis committed to erecting a 121,000-square-foot facility for Prime Cargo, a third-party logistics company, at Prologis Park Szczecin in Szczecin, Poland, near the German border.
“The limited supply of high-quality logistics facilities is driving build-to-suit requirements in Europe,” Philip Dunne, president, Prologis Europe, said in a prepared statement. “Our well-located land bank enables us to continue meeting our customers’ immediate distribution needs in a variety of markets across the region.”
The agreements come on the heels of two other Prologis build-to-suit transactions. In late January, the company announced it had signed on to develop a 262,500-square-foot facility at Prologis Park Littlebrook in Dartford, and a 231,000-square-foot building at Prologis Park Ryton in the West Midlands, England.
The robust build-to-suit activity is a sign of the times. Presently, the commissioning of industrial buildings is the source of the majority of new development in Europe. According to a report by commercial real estate consultancy Knight Frank, while the European economy emerged from recession in 2013 and sentiment went on the upswing, developers and tenants remain cautious. Therefore, “new construction continues to be driven mainly by built-to-suit activity, with speculative development remaining scarce in most markets.”