After 20 years of rapid development, Poland is the leader of the warehouse market in the Central and Eastern Europe with 11.2 million square metres of modern warehouse space. 2016 was a record-breaking year in terms of supply and demand when 1.26 million sqm was delivered to the market, while transaction volume amounted to more than 3.32 million sqm. Colliers International has a significant share in this success, which after 20 years in Polish commercial real estate and effectively responding to market changes, leads the way among consulting firms in the warehouse market.
The development of the warehouse market in Poland began in the mid-1990s with the construction of two Class A warehouses with a total area of 25,000 sqm by two US companies TKG International and Menard Doswell. Despite the rate of $10 per sqm of warehouse space and $23 for office space, both facilities were occupied in the blink of an eye.
“International companies were already operating in Poland. They were accustomed to Western standards and they sought them out in our country. The success of these projects was a signal for other developers that there was a hunger in Poland for modern warehouse space. In the late 1990s, new companies such as AIG Lincoln, Prologis and MLP Group appeared, and they were later joined by others, including Panattoni, SEGRO and Goodman,” saysTomasz Kasperowicz, Partner at Colliers International and Director of the Industrial and Logistics Department.
During the first years, the main region where warehouses were built was Warsaw and its surroundings – by 2004 supply exceeded 770,000 sqm, while regional markets amounted to only 200,000 sqm. The first warehouses outside the capital appeared in Upper Silesia, Central Poland and Poznań. A warehouse with an area of 8,000 sqm was built in Kraków (in 2000). However, until 2006, no new facilities were built there.
“When more than a decade ago SEGRO started operating in Central Europe, the Polish warehouse market was in its infancy. Initially, the growth rate was quite slow, due to the lack of adequate transport infrastructure. In time, along with improvements in the quality and quantity of roads and the influx of investors, the market started to grow, the effects of which we see today, with new records being beaten. Our company since the very beginning of being in Poland, i.e. from 2006, has carried out high-quality warehouse and production projects. In the early years, it built in the vicinity of Poznań, Stryków, Gliwice and Warsaw, and later developed parks in eight key locations throughout the country,” says Magdalena Szulc, Director of SEGRO Central Europe.
A strong incentive for developers to pay attention to the regions was the activity of tenants, who by their growing demand for modern warehouse space began to shape the future of this market.
“In ROHLIG SUUS Logistics, when we were building our network of national distribution warehouse in Poland, we recognised the potential of the regions. Initially, we conducted logistic operations in facilities that often required constant investment to provide services at a high level. Over time, we were able to encourage local companies to use contract logistics services, which prompted investors to build modern Class A warehouse space in regional cities. Today, like several years ago in the West, modern warehouses are appearing throughout Poland, and an example of a region where a lot of warehouses are being built is the Eastern Wall, where ROHLIG SUUS Logistics is present in warehouses located in Lublin, Olsztyn and Rzeszóow,” says Anna Galas, Contract Logistics Director at ROHLIG SUUS Logistics.
Golden years and crash
The breakthrough for the Polish warehouse market was Poland’s entry into the European Union. In the space of four years (up to the bankruptcy of Lehman Brothers in 2008), nearly 4 million square metres of modern warehouse space was delivered to the market, of which nearly half came in the record year 2008. During this time, the first warehouses were built in Wrocłlaw, Tricity, Toruń n and Szczecin. New supply was also recorded in Kraków.
“After Poland’s accession to the EU and the opening of the borders, developers found that the investment risk in Poland was smaller, and they therefore began to follow clients and acquire land for future investments in the regions,” says Maciej Chmielewski, Partner at Colliers International and Director of the Industrial and Logistics Department.
After the collapse in 2008, market supply slowed down. Developers reduced speculative investments, opting instead for BTS (build to suit) and pre-let investments (secured by earlier leases). Stable growth appeared again in 2010, and in 2014 we were seeing impressive increases in supply.
“One of the main reasons for such a spectacular revival in the warehouse market in Poland is the emergence of a new sector of the economy, e-commerce, which needs huge warehouses. Transactions with companies that sell online – Amazon and Zalando – are among the largest on the market,” says Tomasz Kasperowicz.
The development of the warehouse market in Poland is inextricably linked to the appearance of professional consulting companies, which from the beginning have played a key role. Over 20 years, however, they have changed the way they operate. When the warehouse market in Poland was still in its infancy, agencies were an extension of developers’ sales departments and they sought customers for their warehouses. Today, tenants are assisted by advisors in finding suitable space on the best possible terms. The record transaction concluded with the help of a consulting company, which was Colliers International, was the acquisition of a building with an area of 85,000 sqm in Poznań for Intermarche.
Future of the market
According to Colliers International experts, in the coming years Poland will maintain a rapid pace of development, provided the good market situation is maintained.
“The Polish warehouse market has huge growth potential due to its attractive location, lower costs of labour and land acquisition and faster administrative procedures related to permits,” emphasises Tomasz Kasperowicz.
“5 key regions are of interest to developers, but the importance of the eastern part of the country is also increasing. Some companies are looking for space for light manufacturing, and one of the main factors is access to human capital, of which there is no shortage in the east of the country,” adds Maciej Chmielewski.
Source: Outsourcingportal