Excellent location, access to qualified staff and large supply of modern office space attract many foreign companies to Katowice - according to the latest report by Colliers International, prepared in cooperation with the Katowice City Hall entitled "The future starts here... Katowice". The warehouse market in this region is also very active on the part of tenants and developers.
Katowice is a unique place on the map of Poland, which is a model example of a dynamic transformation from an industrial centre into a modern metropolis. The capital of the Silesia focuses on the most important social and cultural functions and is a major academic, industrial and business centre of southern Poland. The basic values shaping the strategic vision of the city's development are described by the innovative 4i concept: intelligence, innovation, integration, internationalisation.
“In accordance with our development strategy, we are taking steps to make Katowice: intelligent, i.e. making full use of the inhabitants' knowledge potential; innovative through the creation and implementation of technological, cultural and social innovations; integrated, i.e. with a high level of internal social, economic and territorial cohesion, and international - with high accessibility and recognition. In order to achieve these values, we cooperate with residents, investors and other partners, who want to help us to transform Katowice into a unique and attractive place to invest, work, live or simply spend free time,” says Ph.D. Marcin Krupa, Mayor of Katowice.
A business magnet
A great advantage of Katowice is its location - at the intersection of trans-European transport routes, with access to the A4 motorway and a very well developed road network. Qualified staff and constantly growing real estate market make Katowice one of the most important business centres in Poland.
“The attractiveness of the city and the region is noticed by foreign companies, especially from the SSC/BPO/IT/R&D sector, which willingly choose Katowice as the location of their headquarters. Currently there are over 110 centres in the metropolitan area (GZM), with over 25,000 employees,” comments Paweł Skałba, Senior Partner, Director of Office Agency at Colliers International.
“Over the last few years, Katowice has developed a lot. The centre of the Metropolis attracts new investors every year, especially from the modern business services sector. Relatively high salaries (managers' wages are at the level of 10-15,000 PLN/month), a wide range of services and professional development opportunities in an international environment are factors, that attract the best specialists to Katowice. Despite the COVID-19 pandemic, the projected employment is still growing, giving the next generation of graduates a chance to develop their competences in centres implementing financial and accounting, IT or HR processes," says Marta Kaczmarczyk, Branch Manager Professionals in Randstad.
City under construction
The situation in the Katowice office market is very dynamic, due to the falling vacancy rate and high development activity. Developers have accelerated the construction of new projects in response to the growing interest of tenants and investors in the increasingly recognisable Katowice market.
The city is distinguished by the availability of high class office space. At the end of the first half of 2020 the office stock amounted to nearly 560,000 sq m. Thus, the city is ranked fifth in Poland among regional markets. In the last half of the year over 31,000 sq m was delivered, which was almost four times higher than in the same period last year and at the same time the second highest half year result among regional cities (after Kraków). At the end of the first half of 2020 there was 238,000 sq m of modern office space under construction, while another 220,000 sq m is planned to be delivered by the end of 2023. The largest projects are the KTW II skyscraper, which will deliver 39,900 sq m of new office space, two office towers in the Global Office Park - 53,700 sq m in total, and the second stage of Face2Face – 26,200 sq m.
Good results despite the pandemic
At the end of H1 2020, the volume of lease transactions on the Katowice market amounted to 26,500 sq m, only 11% less than in the same period last year, despite the significant economic slowdown caused by the COVID-19 pandemic. Importantly, new contracts accounted for the largest share of total demand (64%), expansions accounted for 21% and renegotiations for 15%. Pre-let agreements in projects under construction or planned accounted for almost 60% of total demand, which indicates high interest of tenants in new projects.
“The high interest on the part of tenants is also confirmed by the number of lease transactions conducted by our company. By the end of September, Colliers participated in 8 transactions for a total of 6,308 sq m. This is a better result than in the same period last year. It is also an important signal, that more and more companies see the potential of Katowice and the region, deciding to locate their business here or develop it through expansion," says Barbara Pryszcz, Regional Director of Colliers International in Katowice.
The vacancy rate in Katowice has been in decline for several years. At the end of H1 2020, it amounted to 6.1%, a decrease of 1.3 p.p. compared to H1 2019. Lease rates in the best A-class buildings range from EUR 13.5 to 15.5 sq m/month, and in B-class projects from EUR 9 to 12 sq m/month. Therefore, Katowice is a competitive market with great potential.
Nearly 3.5 million sq m of warehouses
The location, very good network of express roads, A4 highway, as well as developed railway and air connections make Upper Silesia an excellent distribution hub for Western as well as Central and Eastern Europe and one of the most attractive regions in Poland for investments.
Upper Silesia has been for years one of the top regions with the highest demand for modern warehouse space. The administrative boundaries of Katowice include two large-format modern warehouse projects: the Upper Silesian Industrial Park (14,600 sq m) and a BTS facility of 11,300 sq m, built by Panattoni for Rockwell Automation. Developers have plans for further municipal warehouse projects. In 2021 two 7R projects with a total area of 90,800 sq m will be delivered. Moreover, Panattoni is planning its first SBU project in Katowice, mainly dedicated to last mile and light production tenants - City Logistics Katowice with an area of 69,300 sq m.
At the end of June, the total stock of modern warehouse space on the Upper Silesian market reached 3.44 million sq m. During the first six months of this year, a total of nearly 180,000 sqm of new supply was delivered in 6 schemes. The largest one is Prologis Park Ruda Śląska (51,200 sq m). At the end of June 2020 in Upper Silesia 432,900 sq m of modern warehouse space was under construction.
In the first half of 2020, approx. 417,600 sq m of modern logistics and warehouse space was leased under 47 transactions, not including short-term transactions. The vacancy rate at the end of June 2020 recorded a slight decrease (0.7 p.p.) compared to the same period last year and amounted to 6.2%. Effective rental rates for warehouse space in Upper Silesia remained stable, and at the end of H1 2020 they oscillated between EUR 2.3-2.8 sq m/month.