Industrial and Logistics Market in CEE-17

The “ExCEEding Borders: Industrial & Logistics Market in CEE-17” report discusses key trends, challenges, technologies, labor market and investment incentives in this sector.

The I&L sector in the CEE-17 has become one of the most sought-after asset types since 2019, after Offices and Residential according to Colliers International, CMS and Randstad.

The report revealed that some of the key challenges in this sector include the availability of land and property in locations that meet both the developers and end-user expectations, along with the availability and reliability of utilities, connectivity to transport infrastructure, the availability and skills of the labor pool, and access to investment incentives.

Industrial and logistics real estate markets across the CEE-17 region are all at different stages of maturity, both in terms of size and the pace of development. The total supply of modern Industrial and Logistics (I&L) stock across the CEE-17 is well over 50 million m2 in total. From this supply, the current availability can be categorized as low, with the majority of markets recording vacancy rates of below 5%.

Strong demand from the I&L sector
Kevin Turpin, Colliers International's Regional Director of Research, CEE explains: “Demand from the I&L sector in the CEE region over the past few years has overall been strong and has been driven by the 3PL, retail and distribution sectors, followed by the light production, automotive and FMCG sectors. During the pandemic and looking forward, we do expect to see some changes to the order and volume of this demand with sectors such as e-commerce, data centres and specialist storage increasing their requirements. Despite this, the CEE region has a long industrial tradition and remains very attractive to manufacturers ranging from the full spectrum of automotive parts, through to aerospace, metals and plastics, complex electronics, home appliances, food, beverages, pharmaceutics and medical equipment”.

“While we expect e-commerce to grow at a more rapid pace and drive demand through these challenging times, we also expect that over the longer term, we will see greater demand from producers/manufacturers to bring back parts of their supply chain closer to Europe to mitigate certain risks that we have seen in the past few months. In future, this may mean that larger inventories are stored or produced closer to the end consumer which could also translate to greater demand for I&L space”.