European logistics property specialist CTP aims to double the size of its business park network to 20 million m2 of gross leasable area by 2030.
The growth targets is supported by new research that shows continued strong demand for industrial and logistics space across Central and Eastern Europe, regions that will outperform Western and Southern Europe.
CTP’s current portfolio consists of 10.5 million m2 with a development landbank of 20 million m2 across core CEE markets, Germany, Austria and the Netherlands, where it plans to develop an additional 10 million m2 of logistics space through to 2030, generating annual rental income of €1 bn.
The company is seeing strong demand from existing and new tenants across both CEE (the Czech Republic, Slovakia, Romania, Hungary, Poland, Serbia and Bulgaria) and Western EU markets (Germany, Austria and the Netherlands).
Remon Vos, CEO of CTP, said: ‘CTP has long been a believer in the potential of CEE and there is no doubt that a combination of strong economic fundamentals, emerging global mega trends such as the rise in nearshoring - and key real estate market dynamics, mean the CEE region will continue to outperform Europe's more developed markets, driving further demand for logistics and industrial space. CTP is perfectly placed to meet this demand, with a significant development landbank across the region that will enable us to double our GLA by the end of the decade, developing and operating the highly sustainable, client-focused industrial and logistics space that modern occupiers demand.’
Bert Hesselink, group client relationship director at CTP, added: ‘The continued growth in demand for industrial and logistics space in Central and Eastern Europe is underpinned by a unique mix of drivers, with strong economic growth fuelling rising consumptions and continued growth in e-commerce, which has historically lagged behind Western Europe but is now catching up. Meanwhile, greatly improved infrastructure and connectivity, along with a skilled and competitive labour force, means the region is perfectly placed to capitalise on the rising demand. We anticipate that these fundamentals will drive continued growth in demand of industrial and logistics space through to the end of the decade.’
The demand is being driven by a combination of factors, such as the rise of 'nearshoring' and 'friendshoring'; improved infrastructure, a diverse and expanding economy; the accelerating growth in e-commerce from a low base; as well as skilled workforce and strong labour market fundamentals.
CEE markets offer skilled workforces at competitive rates, which for the transportation, storage and manufacturing sectors are on average less than one-third of those of Western Europe.
Infrastructure investment in all the CEE countries, with the exception of Poland, exceeded the EU average from 2015-2020, as a share of GDP, with improvements in air connectivity and rising demand in CEE’s major container ports.
Real GDP growth in the CEE region is outperforming Western European markets and the whole of Europe and is forecast to grow twice as fast as the eurozone average between 2023-2026.
Domestic consumption in CEE has grown by almost 50% since 2010, more than double the rate of the EU-27 average, with the rise in spending power driving growth in e-commerce, which has lagged behind Western Europe but is now catching up.
Net absorption rates in CEE have outperformed Western and Southern European countries and this is expected to continue over the next five years.
