Demand for industrial space lifted significantly in Q1 2016 in Budapest industrial markets and the hegemony of BTS projects has not broken yet. In the Budapest-South submarket vacancy rate dropped to 4.4% triggering two speculative projects, CBRE reports.
On the supply side, the hegemony of Built-To-Suit (BTS) projects has not broken yet: the only new completion on the market was VGP’s 22,000 sq m shed designed for Nagel in Alsónémedi.
Occupiers’ demand remained strong, total leasing activity totalled 118,300 sq m, 86% above the past 5-year average Q1 volume. Take-up (total leasing activity excluding renewals) amounted for 31,300 sq m, exceeding the 5-year average by 11%.
Vacancy rate showed a remarkable drop, currently standing at 8.6%, down by 5.9 pps year-on-year and 2 pps quarter-on-quarter. The Budapest-South submarket which comprises 57% of total Greater Budapest stock registers a stunningly low vacancy rate of 4.4%. This level of availability has already triggered two speculative projects in the submarket. Both Prologis and Goodman will each deliver 21,000 sq m new space in H2 2016.
In Q1 2016, CBRE’s dedicated industrial leasing experts were involved in multiple major leasing transactions that covers 80% of the real estate agency supported deals.