Greater Beijing Logistics Investment Strategy

Recent years have seen infrastructure logistics and warehouses play an increasingly prominent role in support of accelerating urbanisation and city cluster development across China. Greater Beijing, which consists of Beijing, Tianjin and Langfang, has been no exception to this trend, with the city cluster witnessing the development of high-standard warehouses catering to refined and specialised logistics requirements derived from growing domestic consumption and industrial upgrading.

The growth of high-standard warehouse stock in Greater Beijing has been picking up since 2020, with annual new supply reaching 2.6 million sq. m. in 2022, representing annual growth of 28%. Average annual new supply is forecasted to remain at about 2.1 million sq. m. from 2023 to 2025.

As of Q2 2023, high-standard warehouse vacancy in Beijing, Tianjin and Langfang reached 15.0%, 30.2% and 50.2%, respectively. This has led to concerns as to whether there is a mismatch in supply and demand and, if so, what the extent of any negative impact on long-term rental performance will be.

This report by CBRE analyses differences in high-standard warehouse supply and demand in Greater Beijing’s key submarkets; forecasts future trends; and provides strategic recommendations to investors and developers.