The industrial property market in Central Europe (CE) is undergoing a growth boom, according to commercial real estate consultancy Cushman & Wakefield. Over a quarter of total modern industrial space on the region’s markets was completed in 2007 alone. The 2.2 million m[sup]2[/sup] of leasable space added last year brings the total to 8 million m[sup]2[/sup]. The most active markets are those in Poland and the Czech Republic, with 1.09 million m[sup]2[/sup] and 817,500 m[sup]2[/sup] delivered in 2007 respectively. With a much smaller market Slovakia accounted for 228,000 m[sup]2[/sup] while due to lower investor confidence Hungary gained a lower 123,000 m[sup]2[/sup] of new industrial facilities.
The industrial property market in Central Europe (CE) is undergoing a growth boom, according to commercial real estate consultancy Cushman & Wakefield. Over a quarter of total modern industrial space on the region’s markets was completed in 2007 alone. The 2.2 million m2 of leasable space added last year brings the total to 8 million m2. The most active markets are those in Poland and the Czech Republic, with 1.09 million m2 and 817,500 m2 delivered in 2007 respectively. With a much smaller market Slovakia accounted for 228,000 m2 while due to lower investor confidence Hungary gained a lower 123,000 m2 of new industrial facilities.
Vacancy rates are another favourable indicator, particularly given the current rate of development. Compared to an average industrial vacancy rate of 10 - 12% in Western Europe the countries of CE, with the exception of Hungary's 18% vacancy, have significantly higher take up. The Czech Republic has the lowest vacancy rate of 6%, with Slovakia (8%) and Poland (10%) following close behind.
'Supply and demand are very balanced with regards to industrial space in the Czech Republic in particular. The strong demand for space from occupiers attracts developers to construct more, which helps to expand the offer of free space for lease, which in turn keeps pushing rentals down,' said Ferdinand Hlobil, head of the Central European industrial team at Cushman & Wakefield.
Prologis leads the CE market with a 33% share while Panattoni (15%) and CTP (14%) are the other two largest industrial developers. 'All major developers that operate in the Central European industrial market are companies with foreign capital, which serves to differentiate this region from Western European countries,' commented Hlobil. Similar transaction volumes to 2007 are expected this year as well.
Click on the link below to read Cargo-Partner leases 16,000 m2 from Prologis in Budapest
