Moscow, April 7, 2017 – Q1 2017 results show that 109,000 m2 of quality warehouse space was commissioned in Moscow and its vicinity, which is 23% more year over year. More than 90% of the facilities are located in the north of the Moscow area. According to preliminary forecasts, new construction in the Moscow area in 2017 will not exceed 550,000-600,000 m2. This low figure is due to the fact that developers are primarily trying to utilise existing space, according to a report by international consulting company Colliers International.
Two of the largest facilities commissioned in Q1 2017 were a new 25,000 m2 building at the Sever 2 logistics park and a 20,000 m2 at the Dmitrov logistics park.
Given the restrained pace of commissioning new space and the stable demand for quality warehouse facilities, the vacancy rate continues to decline gradually and at the end of Q1 2017, it was 10.4% or 1,339,000 m2. Colliers forecasts vacancy of 9%-9.5% by the end of 2017.
Colliers experts say that the Russian economy will continue to stabilise in 2017, which will positively affect the warehouse and industrial real estate market. In 2016, demand was comparable to pre-crisis years. Colliers expects that in 2017, the high demand of potential tenants and buyers will remain stable and absorption in the Moscow area in 2017 will be equivalent to or higher than that of 2016.
Eleonora Bogdanova, regional director of Warehouse, Industrial and Land, Colliers International Russia: “Despite the beginning of the year being conventionally considered a period of calm, it was a very active first quarter in the warehouse real estate sector. Clients were actively interested in warehouse space and pursued deals. The current market situation is favourable for concluding new contracts – the market offers a large selection of available quality premises, while developers are still willing to offer attractive terms in a highly competitive environment. The restrained pace of new commissioning, developers' rational approach to building new facilities, and stable demand from tenants and buyers will undoubtedly have a positive impact on the entire sector.”