Prologis Research findings suggest that supply chains are undergoing a transformation towards greater resilience. This shift naturally requires holding more stocks - in particular, retailers' stocks would have to increase by 13% to meet demand in 2021. In the pre-pandemic year of 2019, stocks lagged behind demand by only 1.5%. In the US market, the current shortage of capacity in the short term could trigger demand for another 600 million square feet (55.7 million square meters) of logistics space.
It is already clear from the market development that companies are trying to respond to the situation by asking warehouse space for the so-called "Entry markets", ie from locations from which goods can be delivered worldwide. These are, for example, port cities and their surroundings - on the European continent, mainly Rotterdam and Hamburg. The companies want to quickly gain control of their stocks, which is why the average vacancy rate in the world's most important sea connection markets has currently fallen below 2%. This is half as much as in other markets and even less than the historical average of 4.7%.
Prologis Research experts also mention the hypothetical outcome of the situation: "Growing barriers in these entry markets could lead to construction in the secondary markets or increase demand for rebuilding and relocation."