Amazon Is A $12B Machine Creating Product For The Real Estate Investment Market

Korean investors IGIS and Korean Investment & Securities completed an equity raising earlier this month to buy three warehouses leased to Amazon for around £400M When this deal completes later this year, around $12B of assets where Amazon is the occupier will have been traded globally in the last decade, according to data compiled. Amazon is not just a driver of change in retail and e-commerce. It is a machine that has manufactured product for the real estate investment market, and changed the logistics investment sector from a domestic or regional industry to a global one. And given the company still has room for expansion, this is a trend that is only likely to continue. “Before Amazon came along, logistics investment was a bit of a backwater in commercial property investment,” Savills Research Director Kevin Mofid said. “Average volumes in the UK were less than £1B and prime yields were between 5.5% and 6.5%. Today volumes are double that and yields are about 4-4.25%.” That rise in yields equates to an uplift in values of between 25% and 35%.