The Polish commercial real estate market is in the best shape it has ever been, posting a record-high investment volume that exceeded €7 billion in 2018. Office and industrial sectors, in particular, are setting new highs with last year’s trading volumes at nearly €2.6 billion and nearly €1.9 billion, respectively.
As anticipated by Cushman & Wakefield, the Polish commercial real estate market delivered a record-breaking year in 2018 with its total investment volume surpassing the €7 billion mark, the highest level in its history dating back to 2000. The highest ever volumes were posted in the industrial and office sectors: nearly €1.9 billion and nearly €2.6 billion, respectively. The retail volume hit €2.5 billion, coming close to the level recorded in the peak year 2006.
The office market experienced the strongest increase in investment activity, with volumes ahead by almost 88% compared to 2017 and accounting for 37% of 2018’s total. The industrial sector was the second fastest growing sector of the commercial property market with the investment volume up by 72%. More than 3.2 million sqm or 20% of Poland’s total industrial and warehouse stock changed hands throughout 2018. The retail trading volume rose by 33%, accounting for 36% of the total investment volume recorded in 2018. With all transactions closed, prime office and retail yields in Warsaw hit record lows: 4.75% and below 4.5%, respectively.
In 2019, the industrial and office markets are expected to continue to enjoy strong investor demand with shopping centres likely to figure on investors’ radar in the second half of the year.
