Strong Momentum Continues in Q1 2025

 

According to recent market data, the Central and Eastern European (CEE) industrial real estate market is starting 2025 with significant positive momentum. The total stock of industrial space across the region reached an impressive 34.4 million sqm by the end of Q1, representing a 1.1% increase quarter-on-quarter. This growth was supported by the delivery of 0.43 million sqm of new modern space during the quarter.

 

Understanding Supply and Demand Dynamics

 

While the market is expanding, availability remains a key factor for businesses seeking space. The regional average vacancy rate stood at 5.0% in Q1 2025. However, this figure varies significantly between countries, highlighting localized opportunities and challenges. For example, Czechia reported a much tighter market with a vacancy rate of just 3.1%, while Hungary saw rates approaching 10%.

Demand continues to be strong, driven by structural changes in global supply chains, notably nearshoring and the increasing adoption of automation. Net take-up across the covered markets (excluding Croatia and Bulgaria) reached 0.51 million sqm in Q1 2025. A significant portion of this demand, 46%, originated from production-related activities, underscoring the impact of manufacturing shifts in the region.

 

Evolving Tenant Expectations: Technology and Sustainability

 

As businesses evaluate potential locations and facilities, their requirements are becoming more sophisticated. Modern tenants are increasingly prioritizing technological readiness, seeking spaces equipped to support automation, data management, and efficient operations. Furthermore, sustainability (ESG - Environmental, Social, and Governance) criteria are playing a more significant role in decision-making, with businesses favoring properties that align with their corporate responsibility goals.

 

A More Selective and Data-Driven Market

 

The combination of strong growth, varied local conditions, and evolving tenant needs is shaping the CEE industrial market. It is becoming a more selective environment where the quality, location, and features of available space are paramount. For businesses looking to rent industrial or warehouse space, having access to detailed, up-to-date data on supply, demand, vacancy, and specific property features is crucial for making informed decisions in this dynamic market.

Source: property-forum.eu