Regions boxing clever in logistics

Nearly all the industrial-market action in the first nine months of 2005 was taking place outside of Warsaw, according to the latest research from CB Richard Ellis (CBRE).

In its M2 - Big Box Poland report, it says total stock across the country came to 1.6 million sqm, with 13 percent of this built in the last quarter alone. Some 200,000 sqm was introduced to the market and another 294,000 sqm is under construction. An enormous 81 percent of this is located outside of the Warsaw region.

Pretty vacant

Overall, the vacancy rate came to 10.28 percent, an increase of 1.74 percent due to a number of speculative projects. Again the area outside of Warsaw is strongest with vacancy here the lowest in the country.

A major increase in new projects was met by an increase in uptake. Almost 330,000 sqm has been rented since the beginning of the year, which is 84 percent more than in the same period last year. CBRE predicts that rents will remain stable in the near future.

The report splits the Polish industrial market into three sectors. Sector one is warehouses located within a 20km radius of central Warsaw. Here, total warehouse space stands at 615,000 sqm. In Q3 2005 two new warehouses were constructed totaling 16,000 sqm. Currently two projects are under construction and when completed will provide 21,000 sqm of additional warehouse space.

Capital statistics

Sector one's vacancy rate decreased to 6.57 percent. Total warehousing space leased in Q3 2005  amounted to 36,724 sqm, as much as in the first half of 2005. Rents remained stable at EUR 2.70-5.50 (zł.11-22) per sqm per month.

Sector two, which is logistics parks located further than 20km but closer than 100km from the center of Warsaw, had a very strong year so far. For the first time stock in sector two was higher than sector one. Total stock after Q3 amounted to 652,00 sqm. More than 85,000 sqm of logistics space was developed whilst 35,000 was under construction, which is a record figure for this sector. However, vacancy increased to 16.44 percent as most of this new space has been built speculatively. Since the beginning of 2005 132,000 sqm has been leased, 45,000 of which occurred in Q3. Rents were stable at EUR 2.90-3.40 (zł.11.50-13.50) per sqm per month.

Regional records

The logistics stock in the rest of the country came to almost 418,000 sqm. A record figure of 100,000 sqm was delivered to the market with 238,000 sqm under construction and about 77,000 sqm breaking ground so far this year.

Most of the projects were pre-let, meaning the vacancy rate stayed low at 6.15 percent. Since the beginning of 2005 almost 124,000 sqm has been leased. Developers are more likely to build speculative projects in sector three as there is a constant and growing demand for industrial space. Rents have decreased slightly and are now at the same level as those in sector two.