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10/10/2019 - News

What is the impact of E-business on the logistics warehouses market?

1- Conversion:

At the beginning of the years 2000, the Brussels Region granted a lot of permits for the conversion of industrial sites into housing, lofts, etc. But a decade ago, it somewhat backtracked, while realizing that it lost a significant diversity in the small businesses, crafts, artists workshops, etc. The trend today aims to maintain this tertiary sector inside the city, redevelop the urban mix and therefore encourage the renovation of industrial sites rather than demolish them, and even more since the demand has evolved thanks to e-commerce.


2- e-commerce as a new real estate player:

As always when it comes to the law of supply and demand, it is scarcity that defines the market! There is more and more shortage of warehouses, and we know why. But on the other hand, demand is increasing, thanks to new technologies, new professions and e-commerce ... How does it come?


Large groups like Amazon, Alibaba, Bol.Com etc. that deliver to Belgium have huge logistical warehouses on the outskirts. Just for Amazon, 15 new warehouses of more than 100,000 m² were opened this year in Europe!


Beside these giants, all brands, such as Zara for example, also need smaller warehouses in urban centres that we call “buffer warehouses”, allowing to respond more quickly to the demand. The reliability of delivery is a strategic element in e-commerce. Amazon, for example, got it before anyone else and devotes huge resources to deliveries in less than twenty-four hours. At the end of 2014, Amazon set up a one-hour delivery service in major cities, for a selection of products. And in the future, order processing will go even faster, most notably thanks to robots.


Conclusion:

This is just one example that shows how e-commerce can revolutionize real estate business with ever-increasing demands. Of course, other activity sectors are also large consumers of warehouses and industrial properties in the broad sense, such as supermarkets, major retailers, automotive industry, etc. So, this is a real estate category that is doing well and still has fine days ahead!

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