IRF market figures - Q2/2016
About the Industrial Research Forum
The Industrial Research Forum was established in 2010 with its aim to provide clients with consistent, accurate and transparent data about the Czech Republic industrial real estate market. The members of the Industrial Research Forum, CBRE, Colliers, Cushman & Wakefield and JLL, share non-sensitive information and believe the establishment of the Industrial Research Forum will enhance transparency on the Czech industrial market.
The Industrial Research forum is pleased to announce the preliminary Industrial Market figures for Q1 2016.
New Supply in Q2 2016
In Q2 2016, industrial space totalling 182,400 sq m was completed within 11 industrial parks across the Czech Republic. Major completions included the first hall at Mountpark Pilsen completed on speculative basis (43,900 sq m), expansion of the existing premises in P3 Prague D8 for VF Corporation (23,400 sq m) and a production hall for BWI Group in Panattoni Park Cheb (16,000 sq m). The share of speculative completions in Q2 2016 increased significantly to 36% as a result of the Mountpark Pilsen hall completion.
Projects under construction
There was 217,300 sq m of storage and industrial space under construction at the end of Q2 2016, most of it in the Greater Prague area. During Q2 2016 development works started on 63% of the total space that is currently under construction across the country. 89% of the industrial construction pipeline is due for delivery by the end of 2016. The share of speculative development under construction slightly increased to 44%.
Prime headline rents achieved in the Czech Republic remained stable during Q2 2016 and currently stand at 4.25 EUR/sq m/month. The rents for mezzanine office space stand at between 8.00-9.00 EUR/sq m/month. Service charges typically reach around 0.50-0.65 EUR/sq m/month.
At the end of Q2 2016, the vacancy rate in the Czech Republic reached 4.7%, having increased by 57 bps since Q1 2016. This represents the total of 282,900 sq m of modern industrial premises ready for immediate occupation. Vacancy in Prague increased slightly reaching 3.2% at the end of Q2 2016.
During Q2 2016, gross take-up, which includes renegotiations, reached 349,300 sq m showing an increase of 11%
on the Q1 2016 figures. In comparison to the same period of last year, gross take-up declined by 3%.
Net take-up in Q2 2016 totalled 263,700 sq m, which is 25% above the previous quarter. Year on year it increased by 4%. Net demand in Q2 2016 was driven by logistic (3PL) companies (51%).
The share of renegotiations went down to 25% of quarterly gross take-up.
Major Leases within Take-up
The largest new transaction in Q2 2016 was concluded by Sportisimo, who signed a pre-lease for 34,800 sq m at Prologis Park Prague-Rudná. The second largest new transaction was a pre-lease of 24,500 sqm signed by Raben Group for premises at Panattoni D5 Hořovice Park. The largest renegotiation of Q2 was concluded by Personna International, prolonging their 16,550 sq m lease in CTPark Teplice.