Industrial Research Forum Announces Preliminary Industrial Market Figures for Q2 2014
About the Industrial Research Forum
The Industrial Research Forum was established by CBRE, Colliers, DTZ and JLL with its aim to provide clients with consistent, accurate and transparent data about the Czech Republic Industrial Market. The members of the Industrial Research Forum share non-sensitive information and believe the establishment of the Industrial Research Forum will enhance transparency on the Czech Industrial market.
The Industrial Research forum is pleased to announce the preliminary Industrial Market figures for Q2 2014.
New Supply in Q2 2014
According to the Czech Industrial Research Forum the construction activity on the industrial real estate market in the Czech Republic remains strong. The total developer-led industrial stock in the country grew by 99,600 sqm during Q2 2014 and currently stands at 4,631,000 sq m. Given that on average 69,000 sqm is supplied to the market each quarter, the Q2 2014 supply figures are above these typical supply levels showing a 37% increase compared to the previous quarter and 39% year-on-year. 92% of all of the completed premises were leased prior or during construction.
Looking at the entire first half of 2014, industrial premises totalling 162,700 sqm were completed around the country, being the highest volume of new completions since H1 2009.
Majority of the space completed during Q2 2014 was delivered to the Prague market (36% of the Q2 2014 supply), mostly to the portfolio of Pointpark Properties. The remaining facilities were built in CTPark Mladá Boleslav (17,000 sqm for DHL), CTPark Brno II. (33,100 sqm for FEI) and Panattoni Park Stříbro (13,900 sqm for Ideal Automotive).
Projects under construction
According to the data gathered by the Industrial Research Forum another 160,100 sqm of modern industrial space is currently under active construction across the Czech Republic. Speculative construction still remains limited and only accounts for 15% of the current pipeline.
The largest volume of the premises is being built in Prague, including the distribution hub of 39,200 sqm for VF Corporation developed by Pointpark Properties north of Prague, which is currently the largest facility in the construction pipeline. Pilsen region is the second most active submarket in terms of new construction. In addition to new construction, we are also starting to see some properties undergo refurbishment to bring them in line with today’s modern standards and tenant requirements. Among the first of such cases is Westgate Park Rudná (21,700 sq m), west of Prague.
Apart from the premises where the construction actively proceeds further there are around 50 000 sqm of modern industrial buildings in the Czech Republic, where the construction has been stopped and will be re-started once a tenant is secured.
The prime headline rents achieved in the Czech Republic remained stable during Q2 2014 and currently stand at 4.25 EUR/sq m/month. The rents for mezzanine office space stand between 8.00-9.00 EUR/sq m/month. Service charges typically reach around 0.50-0.65 EUR/sq m/month.
Further market data including take-up and vacancy will be published by the Industrial Research Forum in two weeks’ time.