According to Savills latest research report, Europe is to see an additional 11.6 million sqm of warehouse demand due to the manufacturing sector by the end of 2022, based on Capital Economics forecasts data.
Take up in the European manufacturing sector has grown significantly over recent years, rising from 2 million sqm in 2012 to 4 million sqm in 2019, according to the international real estate advisor. Even though take up is expected to be slightly lower in 2020, it is anticipated to surpass 4 million sqm in 2021 again and then continue to rise.
Over the past five years, the UK has attracted £148 billion of private manufacturing investment, creating demand for 2.4 million sqm of warehouse space. This indicates that every £1 billion of private manufacturing investment creates new demand for 16,250 sqm of warehouse space.
“The European manufacturing sector accounts for the same proportion of logistics take up as in the UK at 14 percent. Although this varies by country, we have observed comparable or higher proportions of take up across Central and Eastern Europe with 35 percent in the Czech Republic and 14 percent in Poland, which would suggest that our forecasts appear conservative,” Marcus de Minckwitz, Director, Savills Regional Investment Advisory EMEA, said.
Poland attracted close to PLN 125 billion of private manufacturing investment in 2017-2018, generating demand for approximately 1.1 million sqm of warehouse and industrial space in that period. It can therefore be assumed that every PLN 1 billion of private manufacturing investment creates demand for around 8,600 sqm of leasable space.
“The Polish light manufacturing sector accounts for a stable proportion of industrial take-up at approximately 14 percent, making it one of the key industries on the logistics leasing market. Some manufacturers opt for owner-occupation rather than leasing, but this model also indirectly generates demand for space to let. Their business partners will often choose to lease warehouse and industrial space in nearby industrial parks to cut delivery times,” Kamil Szymański, Head of the Industrial Agency, Savills Poland, commented.