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Nearshoring Opportunities for Real Estate in EMEA Nearshoring Opportunities for Real Estate in EMEA

This report provides valuable insight into the trend of nearshoring production and supply, which is increasingly important for businesses in today's global economy. It examines the drivers of nearshoring in EMEA and what it means to different types of businesses and their supply chains.  

By downloading this report, you can gain a better understanding of the factors driving nearshoring decisions and how to recognize opportunities and consider risks in your own business. 

The main topics include: 

  • The historical trend of businesses offshoring production to far-away locations, particularly in Asia Pacific. 
  • What is changing and driving the nearshoring phenomenon 
  • The impact of nearshoring on different types of businesses and their supply chains. 
  • How different countries are experiencing nearshoring 
  • What nearshoring means to locations and real estate 
  • How to recognize opportunities and consider risks that nearshoring represents from the perspective of occupier, developer and investor 

What is nearshoring? 

Nearshoring is the locating of production or supply to locations close to markets of consumption. This could involve reshoring (the movement of facilities that once were established in futher away locations back to home or near-to-home markets) or new investment in home or near-to-home markets where previously a further away location would have been considered.  

Why is Nearshoring Becoming More Popular? 

Recent global economic shocks and supply chain disruption have illuminated the length and complexity of supply chains. In addition, the rising costs of labour in and transporting goods from Asia, as well as geopolitical factors and a growing focus on sustainability and social impact, all add to the complexity and cost for manufacturers. These factors and more are driving businesses to examine their sourcing and supply chain strategies and they are increasingly considering nearshoring of production and supply. 

The Impact on Different Types of Businesses and Locations 

The trend toward nearshoring has significant implications for different types of businesses for different reasons. For instance, industries that require a high degree of customization or shorter lead times, such as the fashion industry, will likely benefit from nearshoring. Additionally, locations that already are or are close to existing manufacturing hubs, and have good infrastructure and a skilled workforce, are likely to attract more nearshoring investments as industries evolve. Sectors discussed in the report include: 

  • Apparel & Textiles
  • Automotive
  • Machinery, Electronic & Electrical Equipment
  • Consumer Goods 

The Impact on Different Locations 

The opportunities for nearshoring are wider spread geographically than is perhaps currently understood. There is great opportunity in lower-cost, close-proximity Central & Eastern European countries and near-Europe countries like Türkiye and Morocco. But there will also be more investment in Western, Southern and Northern European countries, notably Spain and Portugal, (particularly where existing industries are evolving) as well. As a result of Brexit, the UK will see demand for local production for local consumption but will face challenges attracting investment for distribution to wider Europe. This report includes a detailed discussion on the impact of nearshoring in the following geographies: 

  • Central & Eastern Europe 
  • Türkiye 
  • Morocco 
  • Western, Southern & Northern Europe 
  • United Kingdom

Implications for the Property Market 

The shift towards nearshoring also has implications for the property market. With businesses considering where to locate their production facilities closer to home markets, there is likely to be an increased demand for industrial floorspace in certain locations, for both manufacturing and logistics uses 

Property considerations will largely be focused on newly-built facilities but will also represent opportunities to repurpose existing buildings. In addition, there will be an increasing focus on energy needs and particularly on sourcing sustainably-generated energy.  

Our Expertise

With over 20 years of experience in providing outsourcing solutions to businesses worldwide, we have honed our skills and expertise in delivering quality services. Our experienced professionals are well-versed in the latest technologies and trends, ensuring that we provide you with the best possible solutions for your business needs.

Key factors of nearshoring by geography

Nearshoring in the Central & Eastern Europe

  • Relatively low labour costs
  • Close geographical proximity and strong transport links mean shorter journey times, lower transport costs, shorter order lead times, and greater flexibility in ordering
  • Free and open trade, particularly between EU states
  • Established networks of skilled labour and facilities in key industries
  • Key sectors locating in Central & Eastern Europe include textiles & apparel, automotive, machinery, electrical & electronic goods and some consumer goods

Nearshoring in Türkiye

  • Low labour costs
  • Close proximity, which means shorter journey times, lower transport costs, shorter order lead times, and greater flexibility in ordering, as well as reduced environmental impact
  • Free and open trade with Europe and an investment-supportive environment
  • Key sectors locating in Türkiye include textiles & apparel, automotive, machinery, electrical & electronic goods, and some consumer goods

Nearshoring in Western, Southern & Northern Europe

  • Opportunities where close proximity is important, including where shorter journey times means shorter order lead times and lower transport costs – particularly attractive for Spain and Portugal where labour costs are also relatively low
  • Nearshoring will also be attractive where production processes rely on degrees of automation (and are less dependent on (lower cost) labour), particularly where the cost of investing in automation and technology is high for control and oversight as well as reducing other costs (such as transport)
  • Geopolitical factors also mean that national governments and the EU are actively supporting investment in key manufacturing sectors, particularly in high tech and green technology industries

Nearshoring in the UK

  • Focus on sourcing products within the UK itself as Brexit has resulted in increased complexity, time and cost for UK businesses importing goods from Europe
  • Freeports being established to alleviate the risk of “double dutying” for exports
  • Geopolitical factors also mean that there may be ongoing challenges for the UK to attract businesses to locate in the country to distribute to the EU

Nearshoring in Morocco

  • Low labour costs
  • Close proximity, which means shorter journey times, lower transport costs, shorter order lead times, and greater flexibility in ordering, as well as reduced environmental impact
  • Free and open trade with Europe and an investment-supportive environment
  • Key sectors locating in Türkiye include textiles & apparel, automotive, machinery, electrical & electronic goods, and some consumer goods

Nearshoring: How Cushman & Wakefield Can Help You? 

At Cushman & Wakefield, we understand the challenges and opportunities associated with nearshoring. Our team of experts can help businesses looking to expand their business operations to nearshore locations navigate the complexities of nearshoring, from identifying potential locations to managing the real estate process. We provide various services, including site selection, supply chain analysis, and portfolio optimization. With our global reach and local expertise, we can help businesses unlock the benefits of nearshoring. 

For investors and developers, Cushman & Wakefield can help identify opportunities to work with businesses seeking to nearshoring production and help to deploy capital in newly-emerging asset classes and geographies. In addition, our team of experts can help to identify and manage risks in both existing portfolios and new and potential investments. 

Our Offer 

At Cushman & Wakefield, we offer a wide range of advisory services that are customized to meet your specific business needs. Our services include but are not limited to: 

Logistics & Industrial Lease Advisory

The Lease Advisory team is an experienced, dynamic, innovative and proactive market facing commercial team.

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Industrial Leasing

Cushman & Wakefield provides a dedicated logistics and industrial leasing service to investor, developer and public sector clients across the UK & Ireland.

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There are now five economic factors of production - Labour, Land, Capital, Entrepreneurship, and Data. At Cushman & Wakefield, we understand the significance of each to generating successful outcomes in real estate development.
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Capital Markets

Are you ready for what’s next in the real estate industry? Our Capital Markets team advises institutional and private owners, occupiers, investors and developers on their most significant transactions.

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If you would like to find out more about our specific expertise, or discover how we could work with your company, please contact a member of our team – we’d be delighted to hear from you.
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