ExCEEding Borders: Manufacturing and Warehousing sector in CEE-12

Colliers is delighted to present the latest report in the ExCEEding Borders series. In this edition, we review the situation across 12 key Industrial & Logistics (I&L) and manufacturing markets in the CEE region: Albania, Bulgaria, Czech Republic, Estonia, Hungary, Latvia, Lithuania, Montenegro, Poland, Romania, Serbia and Slovakia.

The Industrial & Logistics property sector has continued to thrive and the total I&L stock for the CEE-12 region has grown within the last three years to exceed 65 million m², with 25 million m² situated in and around the 12 capital city markets. Poland, as the largest country of the group covered in this report, also maintains the largest I&L market and is approaching the 30 million m² mark.

While the disruptions and changes initially brought about by the pandemic continue to play out, the war in Ukraine has also added a new set of significant challenges. Besides the humanitarian tragedy that is ongoing and the continued disruption to CEE and global supply chains, there is a tsunami of inflation that is building up and threatening to bring an economic crisis with it. Since the beginning of last year, the CEE region has been struggling with rising fuel, energy, labour and material prices. By contrast, by the end of last year, these prices began to stabilize and reach levels close to January 2022 in some cases. This gives hope that 2023 will be the time for the market to return to stability.

In addition to the standard description of the warehousing market, we also focused on the manufacturing sector. One of the more developed branches of this market is the automotive sector, where almost every CEE-12 country has seen increased activity. The popularity of this sector is partly related to the trend toward electromobility.

Key findings:
  • The total I&L stock for the CEE-12 region has exceeded 65 million m², with 25 million m² situated in and around the 12 capital city markets.
  • All of the CEE-12 countries experienced a significant rise in rental rates over the course of last year. Despite this, the CEE-12 region still remains competitive to Western European countries in this regard.
  • Recently, there has also been noticeably increased interest in production space by occupiers coming from Asia, mainly China and South Korea.

We hope you find this an interesting read and look forward to discussing your plans and how we can be of help.

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