Real estate players were optimistic about the industrial and logistics real estate market in Poland during a recent gathering of central and eastern European manufacturers.
Tom Listowski, partner and head of industrial CEE corporate client relations at real estate advisory Cushman & Wakefield Poland, said the market is on an upswing. “Last year was a record year in Poland for leasing. When you look at the amount of development activity across the country it’s very dynamic,” he told the Manufacturing Strategy Summit, hosted by Europe Property and CEO Manufacturing Magazine in Warsaw on June 16. “We’re seeing new locations opening up, and we’re seeing existing multinational companies here expanding their footprint and bringing over new production lines.
“The vacancy rate is 5.2%. Total stock is 10 million square metres and there is more than a million in construction as we speak. When look at rents, they have been at record lows, there are stable land costs, stable construction costs, and industrial and logistics is now an asset class that investors are very comfortable investing in.”
Road to success
The boom appears to be spreading out around the country. Mr Listowski said that “new pockets of locations” are opening up thanks to development of the A1, a north-south motorway that will traverse central Poland. “There are challenges in some of these locations in finding talent, but overall the market is very attractive at the moment,” he said.
Marek Forynski, managing director of the BTS (build-to-suit) group of industrial facilities developer Panattoni Europe, said the nature of manufacturing projects is changing, with the focus shifting to more advanced functions and smaller, more complex manufacturing facilities. “We see a trend of foreign companies in Poland relocating or enlarging capacity, but also the processes which are implemented within those facilities is becoming more complicated and more automated,” he said.
This is challenging developers to provide more bespoke solutions to manufacturing clients. “We’re seeing a large number of relatively small projects – below 10,000 sq m – and we’re trying to find some kind of solution for small production projects, which is hard to manage from a price perspective because of fixed costs,” Mr Forynski added