Seoul logistics market rebalances as 2025 absorption outpaces new supply

This marks the first time in four years that this occurred.

The Seoul Capital Area (SCA) logistics market moved towards balance in 2025, with annual net absorption exceeding new supply for the first time in four years, according to JLL. Total net take-up reached 507,400 pyeong for the year, signalling a meaningful shift in market fundamentals as demand strengthened across most submarkets.

JLL reported that vacancy continued its downward trajectory, declining for the fourth consecutive quarter to 15.2% by year-end — the lowest level recorded in eight quarters. The firm noted that improving leasing momentum and moderated supply additions supported the tightening conditions, although the West submarket saw a temporary rise in vacancy following the exit of a master tenant.

Leasing activity remained broad-based, with new rental transactions recorded across all submarkets except the Central area. In the fourth quarter alone, net absorption reached 123,100 pyeong, while the South submarket posted its strongest quarterly performance in two years, driven by tenants from the 3PL, e-commerce, manufacturing and F&B sectors.

Six new logistics centres totalling 98,400 pyeong were delivered during the quarter, with the South accounting for four completions and the South-east and West submarkets each adding one facility. Despite these additions, JLL highlighted that overall supply remained measured relative to demand growth.

Rental performance showed modest upward movement. Net effective rents rose 0.4% quarter-on-quarter to KRW 32,400, with all submarkets registering growth. The North recorded the strongest increase, supported by a significant rent uplift at a logistics centre in Namyangju, JLL said.

Capital markets activity accelerated sharply toward the end of the year. JLL reported that logistics investment volumes reached KRW 2.13 trillion in the fourth quarter, up 54% quarter-on-quarter and 167% year-on-year. The largest transaction was the sale of the Cheongna Logistics Center from Brookfield Asset Management to Kreate Asset Management, backed by KKR, for approximately KRW 1.03 trillion.

Looking ahead, JLL forecasts that new supply in 2026 will fall to around 65% of 2025 levels, potentially allowing net absorption to once again outpace completions. Vacancy is expected to stabilise, while cap rates are projected to compress by around 10 basis points as liquidity conditions improve. With foreign investors continuing to favour logistics assets and domestic institutions expected to step up capital deployment, JLL anticipates sustained activity in core, large-scale transactions in the year ahead.