Despite the dwindling economy in Europe, the logistics market in CEE countries has still a bright future ahead, claimed the participants of the logistics panel at CEE Property Forum 2022 in Vienna.
During the discussion panel titled „Still going strong – What’s driving logistics developments?”, moderated by Miroslav Barnáš, Supervisory Board Member of ARETE, key market players were trying to figure out, how long will the gold rush on the CEE warehouse market last. Monika Duda-Tulejko, Managing Director Poland in DHL Supply Chain was sure, that it still has a bright future ahead. „Speaking of the current situation, of course, it's quite tough, having a war in Ukraine and numerous economic challenges ahead. But Poland and CEE region are still attractive markets for Western Europe. We still do not have such issues with the labour market as in the West, we still enjoy good availability of attractive plots. We have big potential and growth possibilities - in Poland, the Czech Republic, Slovakia and Hungary, the e-commerce sector is booming. Currently, the total share of e-commerce in retail is 20%. Around 2030 will be around 40%. Right now, in Poland, 40% of the space is occupied by e-commerce customers. So we are very optimistic about the future growth and development of Polish warehouses", she commented.
Her opinion was shared by Sławomir Jędrzejewski, Head of Industrial Investment at JLL Poland: „Despite all the challenges we're seeing in the market, its fundamentals are still strong. There is a demand coming from occupiers and every CEE country is seeing both an increase in their takeups and interest coming from potential tenants. The only slowdown we see is that it takes a bit of more time for the tenants to take decisions.”
Not only can Poland boast of good forecasts, but Romania was also called one of the winners of the current market dynamics. „I think the demand on the warehouse markets will be sustained by three elements. The first one is the growth of e-commerce, which is developing rapidly and growing by 30% year-to-year in Romania. Then we have the nearshoring - the relocation of production premises from Asia into Europe and the United States as well. Last but not least, the Russian-Ukrainian war is generating a lot of demand for logistics and production space in Romania. We are dealing with a lot of companies, Ukrainian and western trying to allocate logistics and production capacities to Romania as well. So in a short term, I'm optimistic about the potential; however, we have to deal with the highest level of uncertainty. My main concern is about how we can maintain the confidence of the investors in our markets, and how we can keep pace with the development of the pipeline”, said Sorin Preda, Founder & CEO of Global Vision.
His concerns were addressed by Peter Wojtusiak, Senior Advisor, Revetas Capital. „It's all about risk management. When it comes to negotiating leases, we still look first at the quality of the tenants. As a group, we have a strategy to be sustainable, so focusing on the ESG of the developer is an important issue as well. We gladly buy existing assets, which are fully leased to stable and dependable tenants. In case of the long lease deals, we could consider even the tenants with the lower rating”, claimed Wojtusiak. He also stressed that current economic turmoils and the war in Eastern Europe may be a positive boost for the whole warehouse industry. „If you look at all of the crises, which have happened in history, they've always been catalysts for something positive happening. I frankly think that when we're talking about energy pricing and ESG issues, how to save energy and money is something very positive. I believe that if the energy prices were constant and low, we probably would not make any efforts to actually save any energy or turn the lights off. It will be a catalyst to improve the quality of our buildings”, predicts Wojtusiak.
Mathieu Giguere, Managing Director of the European Cross Border Team, Key Accounts & New Markets at Panattoni has confirmed that his company has already made ESG issues a top issue when designing new warehousing projects. „All of our development projects have to be able to implement photovoltaic systems on the roof. It may not be enough, so we still need to consider alternative sources of energy. We are looking to purchase photovoltaic plants in the Czech Republic or Poland region. The final goal is to have all our facilities operating on fully sustainable energy”, said Giguere.
