Romanian industrial and logistics gross take-up increased in 2017 by almost 15 percent to over 525,000 sqm, registering a new record level, says JLL.
Most of the demand came from logistics, transport and distribution companies, which leased a total of 290,000 sqm, or more than 55 percent of the total. The retailers were also among the most active companies last year, with area contracted of over 110,000 sqm, 22 percent of the total volume rented in 2017.
Around 100,000 sqm have been leased for production activities, but it is worth to mention that these companies usually own the production facilities. For this reason, the share of rentals of such spaces does not reflect the dynamics of this sector.
Another positive element of the market is the fact that 430,000 sqm, almost 80 percent of the total surface rented in 2017, represents net demand – new lease agreements, extensions and pre-lettings, the rest being contract renewals and relocations.
“2017 showed the level of macroeconomic indicators well: foreign direct investment increased to a record level, GDP has had an unexpected upward trend, driven by consumption (2017 is the second year with an increase of over 10 percent in consumption). This picture has encouraged market development even more than we anticipated earlier last year,” said Costin Bănică, Associate Director, Head of Industrial Agency JLL Romania.
The regional structure of demand shows that Bucharest is in the top of the preferences, with 275,000 sqm (53 percent of the total). On the second position is placed Timişoara with 76,200 sqm, followed by Piteşti at 50,000 sqm. In Roman, the traded area has accumulated 32,000 sqm, in Cluj 25,250 sqm, and in Ploiesti 24,700 sqm.
“With a few exceptions, the demand and the new offer have focused last year on the locations that are already development hot spots. From this point of view, there is an imbalance in the market, which will be maintained as long as the problems related to the availability of labour and infrastructure,” commented Costin Bănică.
In 2017, the developers delivered projects amounting to almost 360,000 sqm, out of which 242,000 sqm (67 percent of the total) were built in Bucharest and Ilfov. About 40,000 sqm were delivered in Cluj, and 34,000 sqm in Timisoara. Roman recorded the first development of modern space after WdP completed Profi warehouse, with an area of 33,500 sqm.
“The sentiment of investors remain positive, which makes us believe that in 2018, the industrial and logistics market will have an another remarkable performance,” said Costin Bănică.