Logistics Under Pressure: Why Investors Are Turning to BREEAM In-Use
- peterhhowle
- Sep 29
- 4 min read
Updated: Oct 3
Logistics real estate has become a critical asset class in European portfolios. But while demand for modern logistics facilities has surged, the sector has historically lagged in sustainability certifications. This is changing fast — and investors who move quickly stand to capture both rental premiums and resilience.
Logistics: The Growth Engine of Real Estate
Logistics has been one of the standout performers of European real estate over the past decade. Accelerated by e-commerce growth, supply chain restructuring, and demand for last-mile delivery, logistics assets have commanded investor attention and significant capital inflows [1]
Yet when it comes to green building certification, the sector has historically trailed behind others such as offices and residential. In 2013, for example, only 260 logistics certifications were held, compared to 1,090 for offices and 490 for residential assets. Even as adoption accelerated across real estate, logistics remained underrepresented.
By 2020, logistics had achieved 2,670 certifications — less than 40% of the volume of offices (6,780) and only half that of residential (8,230). Even as adoption accelerated across real estate, logistics remained underrepresented.
The Catch-Up Opportunity
The landscape is now shifting. Sustainalytica’s analysis of BRE data shows that between 2020 and 2023, the number of BREEAM In-Use certifications held by the sector grew by 291%, from 2,670 to 10,450. This growth outpaced both offices (+169%) and retail (+212%) over the same period, narrowing the performance margin and signalling stronger momentum.
Several factors explain why logistics has lagged historically:
Operational Sensitivities – Some occupiers have been reluctant to participate in assessments, citing concerns that external inspections might interfere with sensitive operations. In practice, these concerns are misplaced. BREEAM In-Use assessments are carefully designed not to disrupt tenant activity, and Sustainalytica’s experts are experienced in navigating operationally sensitive environments with discretion.
Slow Adoption of Green Leases – Compared to offices and residential, logistics has been slower to embed green lease clauses that support data sharing and joint action on sustainability. Without such frameworks, gathering the evidence required for certification has often been more complex.
Energy Intensity – Logistics facilities are high consumers of energy. While this has made certification more complex, BREEAM In-Use allows for non-standard energy consumption to be excluded from calculations, ensuring fair assessment of operational efficiency without penalising atypical loads.
As Peter Howle, Sustainalytica’s Managing Partner, notes:
“Logistics has been the quiet laggard in certification. Investors who act now can transform that gap into an advantage.”
Why BREEAM In-Use Is the Framework of Choice
Among certification schemes, BREEAM In-Use (BiU) has become the benchmark for operational assets in Europe. Its dual focus on Asset Performance (primarily energy, resilience, transport infrastructure) and Management Performance (specifically policies, procedures, tenant engagement) makes it particularly suited to the logistics sector.
The scheme’s emphasis on transport, energy use, and resilience — all core to logistics operations — means BiU certification is not just a sustainability label, but a performance framework.
Importantly, BiU certification is also a key differentiator for GRESB scores. GRESB awards points not only for overall green building certification (GBC) coverage, but also for the distribution of certifications across property types. Given that logistics assets often make up the largest share of portfolio unit area, they are too significant to be left uncertified.
The Investor Case
For logistics investors, certification delivers three key advantages:
Rental Premiums – Certified assets achieve higher rents. Independent research has shown green-certified properties consistently command income uplifts, with 23–26% premiums identified in European studies.[2]
Portfolio Resilience – Certification reduces the risk of stranded assets under EU carbon disclosure regimes and national energy efficiency standards.
Capital Market Differentiation – Certified portfolios are more attractive to institutional buyers, supporting yield compression and enhanced exit valuations.
Concerns around tenant cooperation, once a perceived barrier, are increasingly being overcome as owners and occupiers recognise their shared interest in certification. Sustainalytica supports this by providing practical, non-intrusive pathways to certification — ensuring assessments respect tenant operations while delivering robust outcomes.
What Comes Next
The certification gap in logistics is closing, but the pace of adoption suggests the window for early mover advantage is narrowing. Sustainalytica’s research of BRE data shows that by 2023, logistics certifications had grown to 10,450, narrowing the gap with offices (18,260, +169% since 2020) and retail (4,370, +212%).
Despite this surge, logistics still trails residential (29,610 certifications). The disparity highlights the remaining opportunity: logistics remains under-penetrated relative to its share of investment capital. For proactive investors, scaling certification quickly across logistics portfolios can deliver both immediate rental benefits and long-term resilience.
Conclusion
The logistics sector is under pressure. Rising energy costs, stricter regulations, and tenant ESG commitments mean uncertified assets face growing risks. At the same time, BREEAM In-Use certification provides a proven pathway to mitigate those risks and capture upside through rental premiums and stronger valuations.
For investors, the message is clear: the certification lag in logistics is closing fast. Those who act now can turn historical underperformance into a source of competitive advantage.
[2] Independent research sources: University of Reading (2019): rental premiums of 23–26% for BREEAM-certified assets; Meta-study (2023): 77% of 70+ studies found statistically significant positive rental uplifts for certified properties.
"For investors, the message is clear: the certification lag in logistics is closing fast. Those who act now can turn historical underperformance into a source of competitive advantage."
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