The largest completed industrial hall is a building with a total size of 26,800 square meters, which is located in the industrial VGP Park Olomouc and was completely occupied at the time of completion. The second largest completed building is in Contera Park Ostrava D1 (25,000 square meters) and at the time of completion was fully leased to the distribution company AT Computers. The third largest completed project is the hall in the Ostrava Airport Multimodal Park, which was also fully occupied at the time of completion by the manufacturing company ABB (13,500 square meters).
Projects under construction
At the end of the second quarter of 2022, a record number of areas were under construction. This is almost 1,271,000 square meters of warehouse and production space, which is an 11% increase compared to the previous quarter and an increase of 93% compared to the second quarter of 2021. Approximately 19% of these areas are located in the Olomouc Region, approximately 16% in the Pilsen Region and another 15% in the Moravian-Silesian Region. The construction of halls with a total area of approximately 201,000 square meters was started. The share of industrial premises in speculative construction (without a pre-secured tenant) rose slightly again in the second quarter of 2022, to 33%. Approximately 900,000 square meters of warehouse and production space is expected to be completed by the end of 2022. Combined with the first half of the year, this would be the largest amount in the history of IRF that was delivered to the Czech market in one calendar year.
Gross realized demand (including renegotiations) in the second quarter of 2022 reached 670,700 square meters, which represents a decrease of 10% compared to the previous quarter. In a year-on-year comparison, this is an increase of 26%. The share of renegotiations fell by 25 percentage points compared to the previous quarter, and thus accounted for 21% of gross realized demand. In a year-on-year comparison, the decrease amounted to roughly 6 percentage points.
Net demand totaled 530,500 square meters in the second quarter of 2022, representing an increase of 31% over the previous quarter and a 36% increase over the same period last year. In the second quarter, the largest share of net demand (excluding undisclosed contracts) was primarily distributed by distribution companies, which accounted for 60% of the total volume of leased space. This was primarily due to the largest lease transaction in IRF's history, which took place in the second quarter of this year. This was followed by logistics companies, which accounted for 27% of net realized demand. Companies from the manufacturing sector were further behind them with a 13% share of the total volume.
The largest new transaction in the second quarter of 2022 was a pre-lease in Panattoni Park Cheb of almost 233,700 square meters, which was signed by an undisclosed distribution company. The second largest realized transaction was a new lease of 58,600 square meters in Prologis Park Prague-Rudná, where the logistics company DB Schenker leased the premises. The third largest realized new lease was the pre-lease in the hall in Panattoni Park Chomutov North, where the distribution company Amazon leased a space of 14,900 square meters.
The largest renegotiation (27,000 square meters) in the second quarter was concluded at Segro Logistics Park Prague, where an undisclosed company signed an extension of its existing contract.
At the end of the second quarter of 2022, the vacancy rate reached 1.5%. Compared to the previous quarter, when the vacancy rate was revised to 1.7%, this is a decrease of 17 basis points. Compared to the same period last year, this is a decrease of 53 basis points. In total, there is currently only 150,400 square meters of modern industrial space on the market, which is ready for immediate occupancy. Vacancy of industrial premises in Prague and its immediate surroundings reached only 0.5% in the second quarter (which includes vacant offices and short-term leased premises).
The highest achieved rent for industrial and logistics real estate (so-called prime headline) in the Czech Republic reached the level of 7.25–7.50 euros/m2/month in the second quarter of 2022. Some special offers, especially in Prague, start at 8.00 euros/m2/month. The amount of rent for office buildings reaches 9.50-12.50 euros/m2/month. The usual amount of service fees varies between 0.65-1.00 euros/m2/month.