According to the latest report from global real estate services firm Cushman & Wakefield, Poland recorded the second-highest industrial take-up in Europe between January and September 2024. Looking ahead, robust demand, coupled with a decline in speculative construction, is likely to tighten the availability of warehouse space for lease.
TAKE-UP: Poland secures a podium finish once again
Total take-up for January-September 2024 surpassed 3.8 million sqm, marking a 4% increase year-on-year and placing Poland second in Europe, just behind Germany, which recorded 4.0 million sqm of transactions. This reaffirms that Poland remains an attractive destination for industrial and warehouse projects as it benefits from competitive logistics costs, including energy, labour and lease costs, which are half those of Western European countries and up to 25% lower than in other countries of Central and Eastern Europe. These advantages, coupled with the continued growth of e-commerce, logistics and production, sustain strong demand for warehouse space,
comments Damian Kołata, Partner, Head of Industrial & Logistics/E-Commerce CEE, Cushman & Wakefield.
Logistics companies led the pack, accounting for 28% of total year-to-date take-up, followed closely by retail and e-commerce, whose share was just 1 pp lower. Other significant contributors included the production and automotive sectors, which made up 12% and 8% of the leasing volume respectively. The strength of the Polish industrial market is evidenced by the take-up structure: new leases and expansions represented 65% of all transactions in the third quarter, while renewals accounted for the remaining 35%,
adds Adrian Semaan, Market Analyst, Cushman & Wakefield.
SUPPLY: Speculative development continues to decelerate
More than 454,000 sqm of new industrial space was delivered across 22 parks between July and September 2024, bringing Poland’s total industrial stock to nearly 34 million sqm. Approximately 72% of this total had been pre-let before completion. Although another 700,000 sqm is expected to come on stream by the end of this year, only a small portion will be available for lease as more than 70% of this total has already been pre-let,
says Damian Kołata.
Projects that broke ground in the January-September period totalled 1.2 million sqm, representing the lowest level since 2016, which is likely to push vacancy rates down over time. In the third quarter alone, the overall vacancy rate edged down to 8.0% by the end of September 2024 and is expected to continue its downward trend, driven by the projected economic recovery and the gradual reduction in speculative construction. While Poland’s average vacancy rate remains relatively high, demand outstrips warehouse supply in some locations, particularly in urban submarkets within large agglomerations such as Łódź, Kraków, Warsaw, Gdańsk, Wrocław and Poznań, where the development of new projects on a speculative basis is economically viable,
adds Adrian Semaan.