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Strong industrial construction continued, and rental prices also rose. The first quarter surprised even experts.

5. 06. 2023

Ferdinand Hlobil, a member of our investment committee and real estate expert, summarizes the quarterly results of the industrial real estate market in our Business Voice Industrial Insight podcast.

The latest data clearly shows a positive trend in the industrial real estate sector. In the first quarter of this year, new industrial property construction in the Czech Republic reached 217,900 sqm. The year-on-year comparison shows that the potential for the whole year 2023 is quite comparable to last year, which was one of the strongest years in the Czech Republic’s modern history in terms of industrial real estate construction. The locations in the Ústí nad Karlovy Vary region and in North Moravia in Ostrava were the most developed.

There continues to be strong interest in leasing industrial and warehouse space across the country. The signed lease contracts exceeded 344,000 sqm and the largest tenants are companies from the manufacturing and logistics sectors. They account for almost 70% of the signed contracts.

The total size of warehouse and industrial space in the rental market in the Czech Republic reached 11 million sqm. However, vacant space for lease accounts for only 1.4% of this volume. “Overall, the supply is very limited, which puts tenants at a disadvantage when negotiating lease contracts and also does not encourage a faster inflow of foreign capital,” comments Ferdinand Hlobil and warns that tenants negotiating the renewal of existing contracts should be prepared for significant price increases.

For more information on the quarterly results of the industrial real estate market and Ferdinand Hlobil’s outlook for the coming period, check out the Business Voice: Industrial Insight podcast in Czech on YouTube or the Spotify and Apple Podcasts.

Data source: CBRE

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