Modern industrial and logistics stock reached 3.61 million square meters in the first half of 2019, with more than 85% located in Bucharest, Timisoara, Ploiesti, Cluj-Napoca and Pitesti, cities with highway access.
Bucharest currently has modern industrial and logistics spaces spanning approximately 1.8 million sqm, counting for half of the total, followed by Timisoara (500,000 sqm), Ploiesti (350,000 sqm), Cluj-Napoca (280,000 sqm) and Pitesti (235,000 sqm), according to real estate consultancy company Cushman & Wakefield Echinox.
Modern industrial stock in Romania exceeded 4 million sqm in the first half of the year with the delivery of 24,000 sqm, while another 1 million sqm is set to be delivered by the end of 2020, according to real estate consultancy company CBRE Romania.
Of the total industrial stock, 55% is located in regional cities and Bucharest accounts for the remaining 45%. The capital city remains the country’s most wanted area for industrial developers.
Around 73% of modern industrial stock in Bucharest is located in the western area, in proximity to the A1 highway. The northern area is seen as the next industrial hub in Bucharest, currently hosting 15% of modern industrial stock.
“We estimate 380,000 sqm of industrial stock will be delivered by the end of this year, with many projects located on the outskirts of Bucharest. Projects under development have been largely pre-leased,” said Andrei Jerca, Account Director Industrial Advisory & Transaction Services at CBRE Romania.
New stock delivered in the first half of the year amounted to 200,000 sqm, with Bucharest accounting for 57% of the total (115,000 sqm). In the second half of the year, deliveries are expected to reach approximately 300,000 sqm.
“The first half of the year was dynamic in terms of industrial and logistics stock leasing, totaling 235,000 sqm. Bucharest remains the most attractive area in terms of total stock and transactions. Other major transactions took place in Slatina, where Pirelli is expanding production capabilities by 62,000 sqm, and in Oradea, where car parts manufacturer Sogefi is expanding. This reflects the potential of cities that so far were not among the most sought after destinations and of the market in general and this positive trend is expected to continue,” said Rodica Tarcavu, Industrial Agency Partner at Cushman & Wakefield Echinox.
The vacancy rate countrywide is approximately 6% and rents range between EUR3.7 and EUR4.1/sqm/month, making Romania one of the most competitive markets in Europe.
Considering planned projects announced by large players in the sector, industrial and logistics stock in Romania is expected to top 4 million sqm at the beginning of 2020.
In terms of deliveries planned in regional cities, the central part of Romania will account for 55%, while the western and northwestern region will account for 25% of planned deliveries. A total of 580,000 sqm of new deliveries are expected by the end of 2020, including both projects under construction and under planning.
Industrial and logistics space leasing totaled 113,000 sqm in Romania in the first half of the year, 33% more than in the same period of 2018. Pre-leases accounted for 18% of the total, with 75% of the leased stock located in Bucharest.