2016 was a good year for the warehouse market
Warsaw, February 2, 2017 – 2016 turned out to be record-breaking in terms of supply and demand. The volume of transactions was higher by over 600,000 sqm than in 2015 and at the end of Q4 2016 it reached a level of 3.32 million sqm – according to Colliers International latest report summarizing the industrial market in 2016.
Developer and tenant activity during the previous year led to another record for both sides. Over 1.26 million sqm of modern A-class industrial space was delivered to the market (compared to approximately 941,000 sqm in 2015). At the end of 2016, the total supply of modern industrial space in the main markets in Poland reached approximately 11.2 million sqm.
At the end of 2016, the vacancy rate in the Polish market was 5.4% (compared to 4.6% in Q4 2015). This means that the ratio of unleased space increased slightly, which was caused mostly by completions of speculative projects. Rental rates in the main industrial markets in Poland remained stable during the last year.
Main industrial markets in Poland
Warsaw – During past 12 months, developers delivered over 240,000 sqm of modern industrial space to the Warsaw market. The volume of transactions for all zones in Warsaw stood at 900,000 sqm within 206 agreements. Most industrial space was leased in zone II (662,800 sqm), which is the highest in the country. Moreover, the Warsaw market is the largest in terms of volume of space under construction – 349,000 sqm within 15 projects.
Upper Silesia – During the past 12 months, demand for industrial space constituted 538,000 sqm, which makes Upper Silesia the second largest market after Warsaw. the supply in the second largest Polish industrial market stood at 2 million sqm. In 2016, 228,100 sqm of modern industrial space was delivered to the market within 14 projects. There are 7 projects under construction totalling approximately 150,500 sqm.
Central Poland (the Łódz region) – at the end of December 2016, total industrial stock reached the level of 1.37 million sqm. 172,400 sqm of modern industrial space was delivered to the market, a high score in comparison to last year’s 47,000 sqm. Currently, approximately 77,800 sqm remain under construction. In 2016, in Central Poland 40 agreements were signed totalling over 348,000 sqm of industrial space.
Poznań – In 2016, 206,400 sqm of new industrial space was delivered to the third industrial market in Poland in terms of size. Therefore, class-A industrial space reached nearly 1,6 million sqm. In 2016, in Poznan lease transactions reached 285,500 sqm.
Wrocław – currently, total industrial stock has reached over 1.4 million sqm. In 2016, 129,000 sqm was delivered to the market within six projects and over 100,000 sqm remains under construction. In terms of transaction volume, 2016 was the best since 2013 (460,000 sqm). 64 agreements for 388,500 sqm were signed.
Tricity – at the end of 2016, total modern industrial supply reached almost 380,000 sqm. The Tricity market registered record-breaking demand – 110,000 sqm was leased within 41 agreements.
Kraków – Last year, 48,200 sqm was delivered to the market within three projects. Total industrial space amounted to 247,000 sqm. During the analysed period, 17 agreements for 83,200 sqm were signed.
Toruń/Bydgoszcz – At the end of 2016, total industrial stock amounted to 174,500 sqm. 14 agreements totaling 130,800 sqm were signed last year. BTS agreements constituted 67% of demand. Currently, over 110,000 sqm. is under construction.
Szczecin – in 2016, 43,400 sqm of modern industrial space within four projects was delivered to the market. Total industrial stock amounted to 186,900 sqm. The Szczecin market once more is seeing a significant increase in demand, reaching a record-breaking 350,000 sqm of leased industrial space. There is over 313,000 sqm under active construction.
Currently in Poland, over 1.51 million sqm of modern industrial space remains under construction, of which approximately 75% is already leased. Worthy of note is that developers are frequently deciding on partly speculative investments.
“In 2017, further development of smaller industrial markets is expected e.g. Torun/Bydgoszcz, Lublin, Rzeszów, Szczecin. Due to the fact that smaller companies from the e-commerce sector will develop, there is likely to be interest in Small Business Units (SBU). Despite the low vacancy rate, effective rental rates will remain at a stable level,” said Tomasz Kasperowicz, Partner, Director of the Industrial and Logistics Department at Colliers International.
Apart from large BTS agreements, further BTO transactions will be observed (known also as fee development), in which clients order developers to build warehouses for ownership.
Access to qualified labour and proximity of academic centres will increasingly be decisive factors for production as well as the presence of logistic companies when looking for a location.