“In the three months to June 2024, the Polish warehouse and industrial market expanded by less than 10% for another consecutive quarter. There was nearly 2 million sqm under construction and total take-up almost doubled over the previous quarter (an increase of over 84%). Poland’s overall vacancy rate edged up quarter-on-quarter as vacant stock in standing warehouses reached nearly 2.8 million sqm”, says Jakub Kurek, Head of Industrial and Warehouse, Newmark Polska.

Nearly 1.64 million sqm of new space was delivered in the six months to June 2024, with new supply spread almost equally over the first and second quarters (52% vs. 48%).

There was nearly 1.99 million sqm of warehouse and industrial space under construction at the end of June 2024, down by 14.5% from the first quarter of 2024 and by almost 7% year-on-year.

“The last time that the development under construction in Poland fell below the 2 million sqm mark was in the third quarter of 2020 - this shows that developers remain cautious about launching new industrial projects. The highest concentration of construction activity has for several quarters been in Poland’s six largest industrial markets, which account for nearly 90% of all projects underway, but only three have more than 300,000 sqm in the pipeline. Regions experiencing the strongest development activity are Lower Silesia, Mazovia and Central Poland”, adds Jakub Kurek.

Total take-up for the second quarter of 2024 reached more than 1.76 million sqm, marking an increase of over 84% quarter-on-quarter and nearly 70% year-on-year. This represents the fifth-highest quarterly leasing volume on the Polish industrial market since records began. Transaction volume in the first half of 2024 totalled more than 2.72 million sqm, up by 22.7% from the same time last year.

“The structure of demand in the first half of 2024 was dominated by new leases accounting for 54% of total take-up, followed by renewals and expansions which made 39% and 7% respectively. It is also worth noting that a total of 106,600 sqm was transacted under shorter leases of up to one year,” says Agnieszka Giermakowska, Research & Advisory Director, ESG Lead, Newmark Polska.

The largest lettings of the six months to end-June 2024 included a confidential e-retailer’s lease for 126,000 sqm in Panattoni Park Wrocław Logistics South Hub and LPP Logistics’ lease of a BTS facility with an area of almost 104,000 sqm in Bydgoszcz Białe Błota Logistics Centre. Another large transaction saw LX Pantos renegotiate and expand its lease to nearly 99,000 sqm in Prime Logistics Wrocław in Pietrzykowice. All these transactions were made in the second quarter of 2024.

At the end of June 2024, the overall vacancy rate stood at 8.3%, marking a rise of 0.1 pp over the quarter and 1.6 pp year-on-year. Nearly 2.8 million sqm remained vacant in standing buildings at the end of the second quarter, signifying a steady increase in warehouse availability, compared to almost 898,000 sqm in the pipeline.

“Prime warehouse and industrial rents remained largely unchanged on the core Polish markets at the end of the second quarter of 2024, suggesting that Poland is past peak rental growth. Warehouses featuring energy-saving and sustainable solutions and providing an enhanced employee experience are still in demand. However, locations experiencing relatively high vacancy rates tend to offer more attractive rental rates and incentive packages. At the end of June 2024, the highest rents were in Warsaw (zone 1), Pomerania and Lesser Poland”, says Jakub Kurek, Head of Industrial and Warehouse, Newmark Polska.