CEE Industrial MarketBeat Reports

CEE-6 INDUSTRIAL MARKET Q4 2024

• Poland leads regional demand with record-breaking volumes, recording 5.83 million sqm of leasing transactions (up 4% year-on-year), with retail and e-commerce accounting for 38% of demand, followed by logistics operators at 32%, showcasing the country's continued dominance as the region's primary industrial hub.
  
  
• Regional markets show mixed leasing performance, with the Czech Republic experiencing a 12% decline to 1.43 million sqm primarily driven by manufacturing (51%) and logistics (27%), while Hungary saw a 7% decrease in gross take-up despite stable net take-up figures, and Bulgaria posted robust 14% year-on-year growth in Q4.
  
  
• Development pipelines contract amid economic uncertainty, with Poland's development pipeline shrinking by 38% year-on-year to 1.76 million sqm and new construction starts at their lowest level since 2016, while the Czech Republic delivered just 517,900 sqm, representing a 45% decrease from 2023 and falling below the five-year average.
  
  
• Vacancy rates vary significantly across the region, creating different dynamics for tenants and landlords in each country, with Poland reporting a vacancy rate of 7.5%, Hungary's Greater Budapest area at 7.9%, the Czech Republic maintaining a tighter 3.13%, and Bulgaria showing an extremely constrained 1.6%.
  
  
• Rental rates stabilize after a period of growth, with Poland's prime headline rents remaining flat at €3.20-5.75 per sqm for big-box warehouses and €4.00-8.25 for city logistics, while Hungary experienced downward pressure with prime rates in Greater Budapest falling 3.4% year-on-year to €5.70 per sqm, and Slovakia bucked the trend with rates rising to €5.35 per sqm/month.