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London

UK in prime position to benefit from surge in demand for port-centric logistics

New research from Jones Lang LaSalle highlights the importance of port development for the UK logistics landscape


London, 19th November 2013 - Growth in world trade is contributing to a surge in demand for European seaport warehousing and logistics real estate, according to new research from Jones Lang LaSalle. 

European Seaports: the growing logistics opportunity highlights how changing maritime trade patterns - such as an increase in container ship size, rising global containers, changing distribution channels and renewed growth in world trade  - are stimulating demand for port-centric logistics and industrial real estate.

These factors are intensifying competition between ports across the world as they strive to attract shipping lines and cargo owners. Shipping lines are beginning to seek the benefits of efficiency and economies of scale to minimise costs by introducing larger ships. Very few ports are capable of accommodating the largest container ships of 18,000 TEU, which will mean that the bulk of cargo will be driven through a limited number of gateway ports. Some 95% of the UK’s international trade is transported by sea and last year UK ports handled around 490 million tonnes of freight, including 55 million tonnes in containers.

The report identifies DP World’s London Gateway port, which opened  earlier this month, as one of the significant developments that will impact the future of the European port landscape. It offers unrestricted deep-sea access and the most cutting edge port equipment to handle mega-ships.

Jon Sleeman, Head of UK and EMEA Logistics & Industrial Research at Jones Lang LaSalle, commented: “Port-centric logistics is rapidly gaining momentum as a source of competitive advantage for cargo owners and there is increasing recognition of the benefits of locating distribution centres at, or close to, the ports through which they import/export. Those port locations that can provide port-centric logistics opportunities for cargo owners will be better positioned to win new business than ports which cannot provide these opportunities due to constraints on land.”

Richard Evans, Joint Head of Logistics in Jones Lang LaSalle’s Industrial & Logistics team, added: “The London Gateway port will significantly alter the UK port landscape and the ease with which the country can trade. It will reduce road transport costs, time to market and carbon emissions because it will cut out the need to transport containers to inland distribution centres in the first instance. The evolving logistics landscape will drive new opportunities for port owners/operators, cargo owners, real estate developers and investors.”