If Poland is CEE’s hottest property market, its industrial market could be its hottest sector. The region’s developers of logistics and distribution parks were left reeling under the impact of the financial crisis beginning in late 2008. Nowhere was the carnage as devastating as Poland, where over a million square metres of space stood empty long after the construction crews finished their work.
But somehow, the Polish economy managed to avoid slipping into reverse, and with growth having started in neighbouring Germany last year boosting the mood, the country’s industrial developers began to notice that lease deals were piling up. And with so little new supply coming on line over the course of 2010, a dent in the vacancy figures is finally starting to be visible.
Customers are flocking in now, according to Ben Bannatyne, ProLogis’ Managing Director for CEE. “The Polish take up of ProLogis’ space in 2010 was 656,200 m2, up from 307,000 m2 in 2009,” he says.
For Panattoni Europe, which had less of an issue with vacancy, the market proved favourable enough in terms of new development. The company built 230,000 m2 of new space and leased 356,000 m2 in 2010.
There’s a growing belief that if 2010 was the turning point, real improvement is on the way this year. Joanna Mroczek, Director of Research and Consultancy at CB Richard Ellis in Poland admits that rents still aren’t picking up and the vacancy figures still top one million m2. “But the forecast for 2011 is that rents will move upwards and incentives will be limited,” says Mroczek. The majority of demand forecast for 2011 will come from companies in the logistics sector, expanding retailers and manufacturing companies.
There’s a tendency to look for an end to the crisis in any bit of news that’s not blatantly negative. What’s encouraging about the news from Poland these days is that it has a strong whiff of realistic credibility.
Robert McLean is Editor-in-Chief of CEE Construction & Investment Journal, the region’s leading property magazine.. To read more, visit the CIJ blog.
Image: ProLogis Park – Dabrowa, Poland