Warehouses still in the spotlight, although the pace of growth of supply and demand may slightly decrease
After a record-breaking 2021 in the warehouse sector, developers did not slow down in Q1 2022 – nearly 1.3 million sqm was delivered to the market at the end of March (which was the highest quarterly result in the history of the Polish industrial and logistics market). Thus, the total supply reached over 25 million sqm. A new record was also set in terms of space under construction – 4.8 million sqm.
Will such dynamic growth of warehouses be maintained in the following months of the year? It will be determined by many factors, including the potential escalation of the war in Ukraine and its economic consequences, which are already being felt today, such as rising costs of construction materials, their limited availability, and a shortage of workers.
In Q1 2022, industrial and logistics facilities in Poland continued to attract investors’ – the volume of transactions in this sector amounted to EUR 191 million in Q1 2022. The factors that may decrease the investment attractiveness of the Polish industrial and logistics market include financial instability and high inflation.
Nevertheless, the authors of the report also point to opportunities for further development of the market, including increased interest in investments among investors from Eastern Europe, a gradual increase in the workforce, which enables the construction of new facilities in an increasing number of locations, and the development of smaller logistics markets, which have so far been characterized by the highest vacancy rates and available warehouse stock.
However, which of these aspects will gain in importance in the near future will be largely determined by the events in Ukraine and, with them, the scale of military operations pursued in that country. As transpires from Professor Witold Orłowski’s macroeconomic analysis prepared for the purposes of the report, the optimistic variant assumes gradual stabilization of commodity prices and normalization of the situation in terms of the activity of developers and the investment climate in Poland. In order for this to happen, relations between Russia and the other EU Member States should take a de-escalation course, while any tightening of these relations will result in deterioration of the long-term outlook.
Key findings:
- Opportunities and challenges for the warehouse industry in 2022
- The impact of war in Ukraine on the Polish market
- Investment perspectives for the logistics and production facilities in Poland
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