The positive news is that the regeneration of brownfields or the modernization of older industrial buildings and areas are taking an ever-increasing share in the offer, informs 108 Agency. At the same time, its consultants observe the trend of construction of low-energy buildings with an emphasis on an environmentally friendly approach, in combination with other installations of renewable energy sources.
Another trend is the growing added value of tenants in key projects. "These are, in popular terms, assembly plants, but operations unique in their focus or connection to universities, applied research or innovation," says Jakub Holec, director of 108 Agency. And this is evidenced by the example of the first multi-storey Amazon logistics hub in Panattoni Park Kojetín, which is being built on the site of the former sugar factory, or the investment of 4.5 billion crowns by the American company Ball in a new plant for the production of recyclable cans in Panattoni Pilsen Digital Park in the West Bohemian metropolis.
It is production that still plays a very important role in the demand for industrial premises. According to a qualified estimate, 108 agencies accounted for 25% of total leases from the beginning of 2021 to the end of March this year. Production or technology companies also figure in the rental mix of industrial parks, thanks to the completion of which the limit of 10 million meters of leasable areas in the Czech Republic is exceeded. These are namely VGP Kladno (hall B), Urbanity Park Tachov (hall Gama), VGP Park Olomouc (hall F1), CTPark Aš (hall A3, in shell and core state), CTPark Kadaň (hall KA6), project LogPoint Jihlava or hall DC3 in Prologis Park Brno.
Developers are embarking on the construction and preparation of new projects despite a number of limiting factors. In addition to the rising price of building materials and works, they also include the rising and extremely uncertain price of energy, inflation or stricter requirements associated with environmental impacts and the overall sustainability of construction and operation of buildings. However, development activity is stimulated by weaker tenant demand, despite the correction of the growth of the e-commerce segment.
"Conditions are burdening larger development companies with a strong capital background. The expected cooling of the market in the last quarter of this year, given the fading effects of the war in Ukraine, will be reflected not only in speculative construction. With regard to the continuing demand of companies and the negligible percentage of vacancy, projects with a total area of over 1.1 million square meters are still under construction, "comments Michal Bílý, an analyst at 108 Agency, on the state and possible development of the market. Due to the amount of developing land or older or unused areas, it can be expected that record construction activity will not slow down despite the current obstacles.
Poland continues to have the largest offer of leasable industrial space within the Visegrad Four with 24 million square meters. It is followed by the Czech Republic with 10 million square meters. The Slovak market reached 3.3 million square meters in the first quarter of this year and 2.4 million square meters in the Hungarian market.
Exceeding the limit of 10 million square meters in the Czech Republic is the result of gradually accelerating development. It has been running continuously since 2006, with the only fluctuation in 2010-2012 due to the global financial crisis. In the past 12 years, a number of large industrial areas have been established in the Czech Republic.
"Our industrial and logistics parks are growing together with our tenants, who are expanding significantly in them. Sophisticated supply and demand chains as well as modern production plants are being set up in CTParks. Therefore, I believe that the performance of the Czech industrial space market is to a large extent equivalent to the state of the entire domestic economy. According to the current situation, it is still in very good condition, as it also manages to attract important foreign companies, "notes Jakub Kodr from the development company CTP.
So far, the strongest year under construction was 2018, when almost 800,000 square meters of new industrial space were delivered to the market. In terms of demand, last year was a record year, when net realized demand was 1.58 million square meters.
In 2020 and 2021, several new developers, such as Garbe and GLP, entered the domestic market. According to 108 Agency, the industrial real estate market is thus growing healthily, regardless of fluctuations. A similar development is most likely to continue. However, legislation related to sustainability and construction rules, both at national and European level, will have a major impact on the future situation.