At the end of September, the total supply of warehouse space in Poland amounted to 20.3 million square meters. Warsaw remains the largest of the 11 major warehouse markets, where 4.73 million sq m is located within the three zones, which accounts for 23% of the total supply in the country. 

Within the last 12 months, over 2 million sq m was delivered to the Polish warehouse market, of which 683.7 thousand sq m in the third quarter of this year. This is the best result this year, taking into account the first two quarters of 2020. In the third quarter of 2020 the largest increase in supply was recorded in the Upper Silesia region (232.2 thousand sq m).

Another million under construction

At the end of the analyzed period, 1.53 million sq m of modern warehouse space was under construction - slightly less than in the corresponding period of 2019 (1.83 million sq m). In terms of investments commenced, the leaders are the markets of Upper Silesia (351.7 thousand sq m) and Warsaw (320.8 thousand sq m within three warehouse zones). 

- Newly launched investments are mostly BTS projects, areas at least partially secured by lease agreements and small business units (SBU). Developers are partially moving away from typically speculative investments, which does not mean that they do not secure land for further projects - says Maciej Chmielewski, Senior Partner, Director of the Logistics and Industrial Agency at Colliers International Poland.

The vacancy rate recorded an increase from the end of the first half of the year to 8.2% (+1.5 pp). The largest amount of available warehouse space is currently located in Warsaw's Zone I (11.1%) and Upper Silesia (10.5%), the least in Szczecin and Eastern Poland (below 1%). Rental rates have remained stable.

Demand is not slowing down

In Q3, tenant activity remained high. The total transaction volume amounted to 1.34 million sqm. This is higher than in the previous two quarters (first quarter - 1.13 million sq m and second quarter - 1.32 million sq m). Additionally, more than 110,000 sq m was leased under short-term contracts, which have remained popular among tenants since the beginning of the COVID-19 epidemic.

- In the past quarter, several large contracts were signed, covering areas of 40-70 thousand square meters. Since the beginning of the year, nearly 3.8 million sq m was leased in total. Taking into account that during the first three quarters of 2019 it was 2.86 million sq m, the annual volume of demand has a very real chance to be higher than last year - says Agnieszka Bogucka, Analyst in the Research and Consultancy Services at Colliers International Poland.

In the third quarter of 2020, the structure of agreements in terms of concluded transactions was dominated by new agreements (55%) and renegotiations (31%). The most active were tenants from the retail sector and 3PL, whose representatives covered with contracts a total of about 65% of the space leased in Q3.