The industrial sector in Romania is recording a slowdown in Q1 2024, with the same trend being recorded across Central and Eastern Europe (CEE) markets, according to a iO Partners analysis.
Local demand for industrial spaces amounted to around 192,400 sqm in Q1 2024, down 22% compared to the same period of last year. At the same time, new projects with a combined leasable area of 69,400 sqm have been completed, down by 69% year-on-year.
The current pipeline of industrial projects stands at 700,000 sqm, although actual deliveries could be considerably lower as demand slows and securing pre-lettings becomes more difficult. While industrial rents were stable in Q1 2024, there is still upward pressure on rents as construction costs are high.
The vacancy rate rose slightly to 4.4% in Q1 2024 due to slower demand.
“The decrease in the market is an expected setback from historical highs, against the background of a limited number of large transactions caused by the decrease in volumes in traditional and online retail caused by inflation, but also by the fact that many large retailers have developed in the last 5 years centers logistics with sufficient capacity,” says Viorel Opaiț, Regional Development Director at iO Partners.
Regionally, Hungary recorded a 15% fall in demand in the extended Budapest region. In the Czech Republic, new deliveries were down 50% year-on-year to 148,100 sqm. In Slovakia, new industrial projects accounted foer 132,000 sqm, while leasing fell 40% year-on-year.
In Serbia, the industrial stock available for leasing stands at 844,000 sqm, with a positive development outlook.
