European industrial real estate market grows with investment in Defense

O defense investment is driving the European industrial real estate market, with nearly 200 openings of installations and investment announcements in production linked to this sector in Europe since 2024, according to Cushman & Wakefield data.

According to the analysis of the consultant operating in the commercial real estate sector, there have been 197 openings of installations and investment announcements in Defence-related production throughout Europe since the beginning of 2024.

More than half of the investments concern new installations (54%), of which 36% correspond to new construction projects and 17% to the acquisition, lease or conversion of existing buildings, according to the report “Future Flows: Global Dynamics & European Industrial Real Estate”.

The remaining 46% refer to the expansion of existing industrial plants.

The largest number of new investments is concentrated in the United Kingdom, Germany and France, with the activity “significant in Spain, Italy, Sweden, Turkey, Belgium and the Netherlands”.

Central and Eastern Europe, led by Poland, is a “important destination for investment, especially in artillery, ammunition and other defence-related production capacities”.

Portugal, in turn, has a low weight in this analysis, but the consultant points out, in a statement, that there are signs to point to the same trend, with the strengthening of the investment in Defense to boost new industrial projects, such as the revitalization of the Arsenal do Alféite and the future drone factory announced by Keydef and Flying Wedge Defense and Aerospace.

Also according to the study, the most frequent need corresponds to facilities between 10,000 m2 and 25,000 m2, with the average area of new units in about 20,000 m2, with several companies occupying conventional industrial facilities and adapting them to production for the Defense sector.