Modern industrial and logistic stock reached 4.7 million square meters at the end of June. Around 120,000 square meters in new modern industrial & logistics spaces are estimated to have come online in the first semester of 2020 throughout Romania, with 100,000 square meters in the vicinity of Bucharest, which is less than half the level seen a year ago. The second half of the year is seen to be much more active, with nearly 300,000 square meters in new deliveries expected, two thirds in Bucharest, as quite a few big contracts were signed fairly recently, and the tenants are expecting to move in. This took overall modern industrial & logistics stock to 4.7 million square meters at the end of June, with Bucharest amounting to 2.4 million square meters.

“Total demand reached 249,000 square meters in the first half of the year, roughly unchanged compared to the first semester of 2019. The good result was achieved largely thanks to two large deals involving Profi, a chain of supermarkets, which accounted for nearly half of the total GLA leased in 2020. The retail/FMCG sector in total generated nearly 50.2% of all deals, followed at a great distance by production activities (19.4% of total) and 3PL/logistics (14%)”, says Laurențiu Duică, Partner & Head of Industrial Agency at Colliers International.

Colliers International consultants note that amid the pandemic, incentives are higher, with landlords offering more rent-free months than before; this means that, in some instances, the net-effective rent can reach some 20% below the headline (versus around 13% before). Otherwise, vacancy is still comfortably in single digit territory. It is hovering around 7-8% and has not seen any material changes amid the coronavirus situation. Such levels are consistent with a neutral market, but with the significant pipeline of speculative developments (including such deliveries in recent years) plus a competitive market tilting the balance in favour or tenants. (Source: Colliers)