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Logistics condominium market grows during the pandemic

In the last quarter of 2020, the Brazilian market for logistics condominiums (classes A +, A and B) registered a positive balance of leases, significantly impacting the balance between tenants’ inflows and outflows, according to monitoring by the SiiLA Brasil real estate research platform. In the 16 states of the country monitored by the platform, 672,589 sqm were occupied by more than the total number of devolutions (net absorption), between October and December.

The last quarter movements were very relevant and involved large areas for the most part. In São Paulo alone, gross absorption reached 611 thousand sqm and surpassed 488 thousand sqm of net balance, in addition to the delivery of 86,924 new sqm in the period (all of a high standard). Minas Gerais added 78,601 sqm to the assets, recorded absorption of 94,018 square meters and a net balance of 84,342 sqm.

SiiLA Brasil already expected such performance with many pre-leased deliveries. It was made possible due to leases in the last months of 2020 that reach almost one million sqm: 926,452 sqm of logistics warehouses (classes A +, A and B) received new tenants across Brazil. Many contracts of over 30 thousand sqm were made, and others over 70 thousand sqm.

“New projects delivered marked the period. It is worth mentioning that deliveries of new condominiums have been happening quicker and also, many large contracts have been signed relating to areas much larger than the average. With all this, the positive result was already expected and, without so many exits, the vacancy rate plummeted”, explains Giancarlo Nicastro, CEO of SiiLA Brasil.

According to data from SiiLA Brasil, at the end of 2020, the overall index of vacant warehouses in Brazil was only 13.87% - a drop of 4.5 percentage points seen at the end of 2019, when the rate was 18.3%. The State of São Paulo started 2020 with a vacancy rate of 18.20% and closed with 13.9%.In the last quarter of 2020, another 241,311 sqm were added to the country’s inventory, which today accumulates just over 17.5 million sqm. For 2021, São Paulo projects almost 1.5 million sqm of new inventory (300 thousand would already be leased).

“In this scenario, e-commerce, which still has a great market potential, will continue to pull demand and motivate very high investments”, adds Giancarlo Nicastro.

Large contracts

Mercado Livre and Amazon accounted for some of the most significant negotiations of the year 2020, showing the strength with which large online commerce companies demand logistical spaces.

“It is worth mentioning that these companies are also looking for high-end developments, in the quest to optimise their logistical operations as much as possible for a better and faster distribution of goods. So much so that Mercado Livre leased 75,847 thousand sqm at the DCC Distribution Center Cajamar, a Class A + development, developed by GTIS, Etoile, Grifo and BMC, located just 46 km from the capital São Paulo”, comments CEO Giancarlo Nicastro.

The company also leased an area in Rio de Janeiro. There were 35 thousand sqm of Duque de Caxias LPG. However, the most significant movement was from Ford. As a sign of the industrial demobilisation that would mark the recent announcement of the automaker’s departure from the country, the company had two entrances in logistics condominiums in São Paulo during the last quarter 2020. Upon leaving the land sold in São Bernardo do Campo, the company responded with the lease of 78 thousand sqm of condominiums in Cajamar and another 77 thousand sqm in the DVR Business Park Porto Feliz (in the Sorocaba region).

“Ford alone absorbed 155 thousand sqm. This sector of vehicles and parts was greatly affected by the restriction on the import of inputs last year, which reduced the supply of new vehicles and parts, but has a repressed demand to meet”, recalls Nicastro. “From now on, there is a tendency for traditional companies, which previously had their own industrial and storage plants, to look for logistics projects for lease, aiming to optimise their logistics operations”, completes the executive.

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