Prologis' retail business set to increase in CEE

As demand among retailers for new, well-located distribution facilities continues to increase in Central and Eastern Europe, Prologis' retail business is also growing in the region, and currently represents about 30% of the global provider's total portfolio, says Bert Angel, ProLogis' senior vice president of Global Services in Europe. Angel told PropertyEU that several of the Denver-based group's largest clients in the CEE region are retailers such as UK's Tesco, German retailer Douglas' CEE brand Rossmann and France's Carrefour.

'We signed eight new leases with Tesco in Slovakia and Poland last year', he says. 'Rossman, instead, is targeting the young population of Prague while Carrefour is boosting its exposure to the Polish market'. Attracted by the growing consumer market in the region, an increasing number of Western European retailers is heading east in search of new markets and is looking for accessible distribution facilities in Poland, the Czech Republic, Slovakia, Romania and Hungary. Angel: 'Similar to what happened in the UK, the retail sector is the main driver behind the recent growth of the logistics property market in the CEE region'.

Prologis, which has a portfolio of about 2.5 million m² in the CEE region and a development pipeline of another 500,000 m2, expects to sign over one million m² of new leases this year in Central and Eastern Europe. Angel says that the company’s average market share in the CEE countries stands at about 25%.