Number of deals involving industrial and logistics properties to rise

Newsroom 27/03/2015 | 12:43

After Czech PointPark Properties (P3) bought the Europolis Logistic Park in Bucharest last year, the local market for industrial and logistics space is expected to see further new entrants, as well as more consolidation over the next couple of years, according to JLL Romania representatives.

Simona Bazavan


“There is interest from potential buyers in local industrial and logistics projects, prices are attractive and most importantly there are still good assets on the market to be bought, unlike the situation in the Czech Republic and Poland,” Andrei Vacaru, head of research and consultancy at JLL, told BR. After a boom period between 2006 and 2008, the market is now maturing and entering a phase when some owners are looking to sell, added Cristina Pop, head of the industrial agency at JLL Romania

JLL advised P3, which last year bought warehouse assets in Poland and Romania from CA Immobilien Anlagen AG, including Europolis Logistic Park which with its 215,000 sqm is the largest project of this kind in Bucharest.

Similar transactions, conducted most likely by new entrants but also by a couple of existing players, are expected to take place over the next period, especially as the local market remains fragmented. Unlike the situation on markets such as the Czech Republic or Poland, where up to 40 percent of the stock of modern industrial and logistics space can be owned by a single player, the largest Romanian owner controls some 12 percent of the local stock, said JLL representatives.

“Over the next two years there will be at least two players that will dominate the local industrial and logistics market,” said Pop. Projects that come with enough land to allow extensions are the most attractive to potential buyers, she added.

Interest in the local industrial and logistics space market is also encouraged by last year’s positive evolution. Total take-up involving industrial and logistics space increased to 313,000 sqm, out of which net take-up represented slightly above 60 percent, according to JLL data. This was up by more than half on the 205,000 sqm reported in 2013.

This hike was fueled by local manufacturing companies increasing their production capacities as well as new entries on the local market, explained Pop. The trend is expected to continue in 2015 as well and she forecasts that this year’s gross take-up will reach 400,000 sqm.

As for new investments, this year they will include P3 expanding Europolis by 75,000 sqm and Immofinanz starting a logistics park in Mogosoaia, near Bucharest.

Should demand continue to increase, investments in new projects are also expected to pick up. “Since 2009 there has been almost no significant project developed in Bucharest, unlike the situation on the office and retail segments. Hence the opportunity to move things forward,” said Vacaru.

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