Shuttered shops, empty airports and CBDs that became ghost towns overnight. The last year has been challenging for commercial property owners everywhere. Except for a corner of the sector that has boomed through the pandemic and is likely to continue to do so.
Sheds – better known in real estate speak as industrial or logistics property – have been a key beneficiary of the pandemic-induced behavioural changes among consumers and businesses. I have personal proof of this. Whilst my family enjoyed the services of fine dining restaurants that introduced takeaway and delivery services, my grandmother finally started shopping online.
She wasn’t alone. E-commerce volumes have gone through the roof, taking the stock prices of key e-commerce players like Amazon and JD.com with them.
As a proportion of retail goods sold globally, Prologis Research estimates that e-commerce volumes grew nearly 20% in 2020, up from about 4% in 2011.1 And Euromonitor forecasts that global e-commerce sales will post a 9.5% compound annual growth rate from 2020-2025.2 This trend is unmistakable and, as chart 1 shows, is playing out in Japan, one of the APN Asian REIT Fund’s key investment markets.