Development activity shifted into a positive
direction. In 2017 ten new projects were handed over, with 118,700 sq m new
space, which is 50% more than in 2016. As a result, compared to last year the
modern logistics stock grew with 6%, reaching 2 million sq m by the end of
2017. However, the aforementioned new projects were mostly developed in built-to-suit (BTS) construction
or immediately found tenant, thus only a limited available space remained in
The industrial stock stagnated between 2012 and
2014, but started to grow again in 2015 and further accelerated in 2016.
However, this growth could not keep up with the increasing demand, so the
vacancy rate continued to fall, reaching the unusually low 4% in the Budapest
market. According to Colliers, the vacancy rate is expected to continue to
decline in 2018, due to the limited new speculative projects.
Experts still see continued interest in 2018 for
good quality industrial premises (either to rent or buy) or prepared land for
green field development in countryside locations.
"Currently, based on to the records, more
than 130,000 square meters of industrial property is under construction, which
is foreseen to be handed over in 2018 or has already been handed over at the
beginning of the year. In addition, further development projects are expected
to be launched in the Budapest market during this year, but their exact volume
and completion time is difficult to estimate at this moment.
It should be noted that the warehouse projects -
which are already under construction or will be completed during the year - are mostly built in pre-lease or BTS-construction. These developments
are likely to be occupied even during the construction period, due to the strong
shortage in the market for lettable areas. By the end of the year, it might easily happen that only a few thousands square meter continuous warehouse
space will be available in greater Budapest” - added Tamás
Beck, director of Industrial Agency at Colliers International Hungary.
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