Bucharest metro traffic doubled in March after the pandemic related restrictions were lifted; employees are gradually returning to the office
Bucharest, February 2022: The local logistics sector has not only shown resilience during the pandemic, but went on to benefit from consumer and business reactions to the sanitary crises. Thus, the leasing activity in 2021 has exceeded the 1 million sq. m threshold for the first time in the market’s history. Net take-up accounted for over 80% (802,000 sq. m) of the transacted volume and continues to be the main driver of the market, according to the Cushman & Wakefield Echinox real estate consultancy company.
Companies have accelerated their expansion plans in the last quarter of 2021, the demand for industrial and logistics spaces reaching a record level of 441,000 sq. m, which represents 44% of the entire 2021 volume.
The broad expansion of e-commerce, both geographically and in terms of product range, were among the key drivers of demand over the last year. In this context, the take-up was mainly generated by companies active in the distribution and logistics sectors, and also by retail, FMCG, e-commerce operators, these companies being responsible for 50% of the traded volume.
Network One Distribution, Mobexpert, Havi Logistics, DSV, Elbi, Altex, Metro Cash & Carry, Kuehne + Nagel, ITC Logistics or Tuborg are just some of the tenants who signed relevant leasing contracts during last year.
Other active sectors were the automotive, manufacturing, pharma or courier industries, with almost 200,000 sq. m rented. Bucharest attracted 67% of the 2021 transactional volume, while Timisoara, Brasov and Oradea have been the most dynamic regional markets.
In terms of new deliveries, the full-year new supply reached 530,000 square meters, corresponding to an annual decline of 18%. A sustained occupier demand resulted in the vacancy rate decreasing to 4.2% in Bucharest and 3.5% across Romania.
The strong demand for logistics and industrial properties combined with low vacancy rates, encourages developers to continue their portfolios’ expansion. The pipeline reveals almost 600,000 square meters of new spaces planned for delivery in the next 12 months, with more than 50% of those spaces being located in Bucharest. Timisoara, Brasov and Cluj will also benefit from new industrial and logistics premises in 2022, but there is also a clear interest towards secondary and tertiary cities driven by the recently increased demand for such locations.
Rodica Târcavu, Partner Industrial Agency, Cushman & Wakefield Echinox: “The market continued to be highly dynamic in 2021, driven by a demand coming from various economic sectors. The most active companies in terms of demand come mostly from traditional retail, e-commerce, logistics and distribution.. We are pleased to observe that a large of number of transactions (over 30) with an area of more than 10,000 sq. m have been closed, which gives us confidence that the logistics and industrial market in the country will continue on this impressive development trend. Romania is perceived as an attractive destination for international companies as a result of its geographical connections with the Central and Eastern Europe, the Balkans and the Middle East, and also in terms of the workforce quality and availability and the overall wage level.”
Cushman & Wakefield Echinox, the exclusive affiliate of Cushman & Wakefield in Romania, owned and operated independently, has a team of over 80 professionals and collaborators offering a full range of real estate consultancy services to investors, developers, landlords and tenants. For more information, visit www.cwechinox.com
Cushman & Wakefield, one of the global leaders in commercial real estate services, with 50,000 employees in over 60 countries and € 7.8 billion in revenue, provides asset and investment management consulting services, capital markets, leasing, properties administration, tenant representation, valuation, research, design and project management services. For more information, visit www.cwechinox.com