Southampton well placed to capitalise on growth of super-container ships19th 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 property consultancy Jones Lang LaSalle. The firm said that the Port of Southampton is very well placed to capitalise on this growth, as one of a handful of ports within the UK with a port entrance deep enough to accommodate the new generation of super-container ships.

European Seaports: the Growing Logistics Opportunity highlights how changing maritime trade patterns - such as an increase in container ship size, rising global container throughput along with changing distribution channels are stimulating demand for port-centric logistics and industrial real estate.

More warehouses to accommodate rise in container trade
Global container port throughput has risen from 90 million TEU in 1990, to 590 million TEU in 2012, an increase of 550 per cent. European port throughput volume is forecast to increase from 95 million TEU in 2012 to around 150 million TEU by 2030, an increase of 50 per cent. This increase in container activity is set to result in an extra 20 to 30 million sq m of distribution facilities by 2030, a substantial 40-60 per cent increase on today’s existing warehouse space within the regions of those ports that had an annual throughput of over 500,000 TEU in 2012.

Bigger ships, limited ports
Container ship sizes continue to evolve with 18000 TEU ships now in service. These larger ships will channel the bulk of cargo through a limited number of gateway ports since only 20 European seaports currently offer the required nautical accessibility and handling capacity these ships require.

Michael Green, Lead Director from Jones Lang LaSalle’s Southampton office said: “Seaports are increasingly competing with each other to attract or retain shipping lines and cargo owners. Ports will see their competitive advantage defined by access for the larger ships along with efficient land side connectivity, allowing for efficient storage and onward distribution of cargo along with economic growth in a port’s direct hinterland. Port-centric logistics is increasingly coming into the spotlight as it offers a number of substantial benefits such as reduced transport costs, faster delivery times and less environmental impact through reduced road travel.

"Growth in maritime transport will put pressure on European governments, local municipalities and port owners/operators to provide the required capacity and logistics infrastructure to support this expansion. Those port locations that can provide sufficient port-centric logistics supply to satisfy growing demand for such space will be better positioned to win than others.

"The Port of Southampton is very well placed to capitalise on this growth, with excellent road and rail connections and a port entrance deep enough to accommodate the new generation of super-container ships. The Port has always been an important part of the Southampton economy, but in the near future it will be fundamental to the success of the city and the surrounding conurbations.”