The light industrial market continues to gain stability
The market for light industrial real estate in Germany has become significantly more stable overall in 2025. Although investment activity slowed somewhat in the second half of the year following a dynamic start, the full-year result is still well above that of the previous year. Industrial properties, in particular, remain the driving force behind the market—both in terms of investor activity and demand for space.
With an investment volume of around €1.61 billion, the market exceeded the previous year’s result by more than a third. In the second half of 2025, approximately €720 million was invested, following a first half of the year characterized by particularly strong momentum. This continues a trend that became apparent as early as the spring: following a period of pronounced caution, investors are gradually returning to the market—albeit in a much more selective manner than in previous market cycles.
Industrial real estate remains the dominant segment
Industrial real estate continues to be in high demand. It remained the property category with the highest sales volume in the second half of the year and once again benefited from a high proportion of owner-occupier transactions. Particularly in economically and industrially strong regions, demand for functional and flexible spaces remains stable.
Notably, differentiation within the market is increasing: modern, ESG-compliant properties with good third-party usability and convenient locations remain in high demand. In contrast, specialized or technically outdated properties are coming under increasing pressure. The gap between high-quality properties and those that are difficult to reposition continues to widen.
Southern Germany Maintains Leading Position
Regionally, market activity continues to concentrate on established industrial and business hubs. The Southern region maintained its leading position in terms of investment volume in the second half of the year as well. Interest remains high, particularly where industrial value creation, availability of skilled workers, and robust infrastructure converge.
Although the Rhine-Ruhr metropolitan area remains one of the most important locations in the German light industrial market, it lost some momentum over the course of the year. At the same time, several southern German markets are showing stable fundamentals and consistently high demand for modern space.
Tenants remain active—despite a challenging environment
The leasing market also continued to stabilize. Take-up in the second half of 2025 totaled approximately 1.29 million square meters, exceeding both the first half of the year and the same period last year. While many companies continue to proceed cautiously and make location decisions amid difficult economic conditions, Nevertheless, demand for modern production and commercial space remains high.
Medium-sized and flexible spaces, in particular, are gaining in importance. At the same time, individual large-volume transactions—including those from the defense-related industrial sector—provided additional demand momentum.
Yields and rents stabilize
Following the significant adjustments of recent years, the market is now moving in a much more stable direction. Prime yields remained largely unchanged in the second half of 2025. Rent trends are also mostly flat.
Flex spaces continue to be an exception. Modern and multifunctional spaces in prime locations remain scarce and are commanding rising prime rents. Overall, however, the market is increasingly entering a phase of consolidation and differentiated pricing.
Project pipeline remains robust
Despite challenging financing conditions and ongoing uncertainties, the project pipeline for 2026 points to a continued high level of completions. Industrial properties continue to dominate market activity in this sector as well.
At the same time, construction costs, financing, and economic uncertainties remain key risk factors for future development. Nevertheless, there are strong indications that light industrial real estate is increasingly establishing itself as a resilient component of the German commercial real estate market.
All figures, analyses and trends in detail:
You can download the full report with all data and graphics from the INITIATIVE LIGHT INDUSTRIAL website. The half-yearly report offers comprehensive insights into the investment and rental market, yield developments, completions and regional trends.
Contact:
Daniel Sopka
daniel.sopka@bulwiengesa.de
Tel. +49 40 42 32 22 29
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