Budapest, June 2, 2015 – Increasing investment activity coupled with easing pressure on rents and a sharp drop in vacancy rates in the Budapest industrial, logistics market - these are the main observations of experts, lately. The long awaited recovery is finally visible building momentum on the back of strong leasing activity pushing vacancy rates to record low level since 2008.
Following strong leasing activity in 2014 (net absorption was registered at 128,000 sq m), vacancy in the Budapest logistics market further dropped to 14.5% by the end of Q1 2015, which today is even below those of the office market.
2014 was the first year when investment grade logistics assets exchanged ownership after a 5 years long complete silence and now the asset class appears to be on the win.
“Early in Q2 2015 Colliers International registered three investment transactions already, more than during the course of 2014. Colliers International recently completed its second logistics transaction in the running year, advising a private developer in the sale of an 18,000 sq m large fully let prime city logistics asset inNove Business Park in Budapest, a deal that establishes a new benchmark for prime assets of such within their class.” – commented Bence Vécsey, Head of Investment Services at Colliers International Hungary. The new owner of the building is an open-ended retail fund managed by Diófa Fund Management.
“We are pleased to have been involved in this transaction as well as supporting CA Immo and Union Investment selling one of the largest logistics facilities in Hungary to Prologis a few months ago.” – added Vécsey.
On the development side of the logistics market, there are some rather large live BTS requirements and some experienced developers as well as new market entrants are considering investing in land for future projects.
Source: Colliers International