PL

A hundred years young

Warehouse & industrial
The company might be celebrating its 100th birthday this year, but Segro still seems to have no end of youthful vigour. With Joanna Janiszewska, Segro’s regional director, we take a look at the many activities it is undertaking in the areas of new technology, CSR, sustainability, as well as at its expansion in Poland.

‘Eurobuild CEE’: What has changed most for Segro since the outbreak of the coronavirus pandemic?

Joanna Janiszewska, Segro’s regional director in Poland: The most radical change for our company, as both a developer and manager of modern warehouse and production space, was to put in place a new sanitary regime so that our clients could use their space without any disruption. As soon as the pandemic began, we managed to work out the appropriate procedures for this. We are monitoring the situation on an ongoing basis so that additional safety measures can be implemented if necessary. In this challenging time, we have managed to further strengthen our ties with our business partners. Many of them have, in recent weeks, decided to extend their leases in Segro logistics parks. Looking at the warehouse real estate market as a whole, we can see that there has been a change in the investment structure for developments, with a greater emphasis being placed on the importance of facilities previously secured by lease agreements.

Do tenants at the moment have any particular expectations in relation to Covid-19?

In the face of the economic turmoil and the level of uncertainty, we have been seeing an increasing number of requests for short-term rentals, while e-commerce has been driving a significant portion of the demand. Even before the pandemic we had been getting more and more inquiries about city projects, since they allow you to reach the target customer faster, as well as about environmentally friendly warehouses, which, at the same time as being green help to reduce a lot of the lighting or heating costs .

What other effects could Covid have on this sector if the pandemic continues?

The current situation shows us how right our company’s decision was to locate its facilities in the vicinity of the largest consumer markets and main transportation routes – places where logistics never slows down, even during economic downturns and greater levels of uncertainty. The pandemic has also reduced the number of speculative projects in favour of those secured by pre-leases. Poland could become more attractive to investors as many companies strive to shorten their supply chains – and we are delighted to help them do precisely this, especially considering our experience in the design and construction of facilities for light production. Undoubtedly, new warehouses will be even more tailored to the clients’ needs than they were before, due to the changes set in motion by automation, environmental protection and proptech. All of this will also contribute to Europe-wide efforts to achieve climate neutrality in the next 30 years.

How has Covid impacted the situation in regional locations? Which places are hot right now and does this have anything to do with Covid or not? And just to remind our readers, Segro is present on the five largest markets in Poland: Warsaw, Łódź, Poznań, Wrocław and Upper Silesia.

It’s clear that the popularity of the major warehouse locations is not related to the pandemic. The most popular logistics parks are located in the vicinity of the major conurbations, with access to good infrastructure, especially roads. Of course, we are talking about Warsaw, Łódź, Poznań, Upper Silesia and Wrocław.

What is Segro currently busy with on each of these markets?

First of all, it is worth mentioning the significant enlargement of our portfolio in Lower Silesia. Last year we became the owner of a plot of over 17 ha in Biskupice Podgórne near Wrocław, where the first, almost 30,000 sqm building of Segro Logistics Park Wrocław is currently under construction. Ultimately, the park could offer more than 80,000 sqm of modern warehouse and production space. At the beginning of this year, again in Wrocław, we finalised the purchase of two facilities with a total area of 38,000 sqm, for the development of our new park – Segro Business Park Wrocław. We have also completed the construction of the final building of Segro Industrial Park Wrocław, which lies within the city’s limits, where we have over 8,000 sqm of space available immediately. In Upper Silesia we also have expansion options for parks in Gliwice and vacant space in Gliwice and Tychy. In Warsaw, we have recently completed a facility that is entirely for rent – 5,000 sqm in Segro Business Park Warsaw, Ożarów. We are also starting work on a new part of Segro Business Park Warsaw, Żerań, designed for city logistics. The extension of Segro Logistics Park Poznań, Komorniki by 7 ha is also worth a mention. Thanks to the recent acquisition of an adjacent site, the park can now be expanded with another building with a target size of over 27,000 sqm, of which the first phase of almost 12,000 sqm is already under construction and is pre-leased.

How are you planning to respond to the boom in demand for e-commerce facilities?

Such a trend has already been evident on the Polish market for some time, and we, as a developer of warehouse properties, are always ready to respond to the growing needs of e-commerce companies. The outbreak of the pandemic has clearly further accelerated the development of this sector, and thus increased the emphasis on such aspects as last-mile logistics and how to shorten the supply chain. In response to these factors, which are so important from the point of view of e-commerce companies, Segro is offering facilities designed to meet such needs. Handling many shipments and returns, the appropriate number of docks, human-centric buildings, modern IT installations, comfortable office and social space, and advanced heating and air conditioning systems are all essential features of warehouses designed for e-commerce – and Segro provides them.

This year Segro celebrates its 15th anniversary in Poland and its 100th anniversary worldwide. How can the company celebrate all this in such a difficult time?

The pandemic has thwarted our celebration plans to some extent, but we managed to celebrate this special anniversary with the whole team in Europe and locally online. This situation also confirmed our conviction that people are the most important factor and that having a healthy and motivated team is of paramount importance. At the same time, we’ve been drawing on our many years of international experience by sharing market information and best practices on an ongoing basis. We’ve also launched our Centenary Fund, which we will dip into over the next decade to support local communities in the UK and continental Europe. Most of the funds from the first tranche this year, which will total more than GBP 1 mln, will be allocated to projects aimed at addressing some of the short and long term effects of Covid-19.

What business goals has Segro set for itself for the near future?

We are continuing to think about how to expand our portfolio while focusing on growth through development projects and prudent acquisitions. We are constantly on the look-out for new sites and preparing our locations to efficiently lease and build on them. Over the next few months, we will continue with our strategy of focusing on green solutions and proptech. At the same time, we hope that the economic situation will gradually stabilise and that our current and future clients will help to mobilise us into taking on further development challenges.

How does Segro intend to show its credentials as a modern company? What examples can you give of how you plan to meet future challenges?

At Segro, we attach great importance to introducing the latest technology, in a word, proptech, which brings benefits to our clients in a number of ways. It means not only embracing the modern world, but most of all involves process optimisation and reducing any negative impact on the natural environment. One of the leading trends in proptech is the use of cloud-based data collection and analysis. For example, this could involve a comprehensive utility monitoring system to monitor in real time the consumption of electricity and gas, which allows us to introduce solutions that increase efficiency. A few years ago, we also installed modern access control in our parks, which automatically reads licence plates. This provides greater security and traffic fluency for employees and regular suppliers, which is particularly important for clients in the logistics sector. We’ve also installed chargers for electric and hybrid cars in most of our parks – as this is the future not only of for private transport but also for logistics transportation too. A modern approach is also vital when it comes to the development stage of projects – this is where we guarantee our customers the highest target savings by making human-centric buildings from the best materials on the market – thus preventing heat loss and ensuring optimal air circulation, which in the long term contributes to reducing the environmental impact of the building. And such an environmental approach is another example of how we have embraced the modern world and taken a long-term view of the future.

Care for the environment has become increasingly important for many companies. How important is it in Segro’s development plans?

The sustainable development ideal that guides Segro stems from our organisational culture from our operations in Britain, where taking a pro-environmental approach has been of utmost importance for many years. In the future, as in the past, we will remain firmly focused on green solutions. BREEAM certification is now the standard for all of our new buildings. In addition, we will undoubtedly continue the initiatives that we are already implementing today, including the installation of DALI lighting control systems, water distribution systems, the construction of special parking zones for car sharing vehicles and providing charging stations for electric and hybrid vehicles. We have also taken on board the fact that the green construction we focus on is not only important for our clients’ image, but also reduces the costs of the facilities they use.

How important are CSR activities in Segro’s strategy? Has the company altered its approach in relation to this due to the pandemic?

At the group level, we are implementing our ‘Responsible Segro’ corporate social responsibility programme. This is to ensure that our projects are created for the benefit not just of clients, stakeholders and local communities, but also the environment. To this end, the company has been focusing on such aspects as reducing energy consumption, improving the materials used and minimising the use of natural resources. Under the group’s Segro 2020 initiative, we set ourselves the target of reusing or recycling 80 pct of our construction waste and 60 pct of our excavated waste by 2020. This goal was achieved as early as 2014, six years before the deadline. One of our CSR activities involved installing beehives in four of our logistics parks: Segro Logistics Park Warsaw, Pruszków, Segro Logistics Park Poznań, Gądki, Segro Logistics Park Gliwice and Segro Industrial Park Tychy. The beehive initiative was recognised in the Responsible Business Forum’s annual ‘Responsible Business in Poland 2019’ report. With regard to the situation with the pandemic, we have no plans to cease our CSR activities. On the contrary, these exceptional times require us to be even more responsible when it comes to the social, economic and environmental aspects of our work.

So far, Segro has been guided by the principle of not entering smaller markets – places which, as far as I know, have less 0.5 mln sqm of industrial space. What will be your development strategy going forward?

In this respect, Segro will remain true to its strategy of locating its logistics parks close to the largest urban centres and major transportation routes. We will continue to operate in such locations as Central Poland, the Warsaw and Poznań areas as well as Upper and Lower Silesia that we secure site and develop our parks.

Segro is one of the oldest companies still operating in this sector today. What marks out your strategy from those of the competition? In what ways do you try to stand out?

We create space where extraordinary things can happen. That may sound a bit pretentious, and many people might wonder what could be unique and exceptional when it comes to warehouse space, but it was only by doing extraordinary things that Segro made a name for itself and got to where we are now. At every stage, starting from getting to know the client’s needs, devising ways to meet them, the process of analysis and negotiation, finalising the transaction, the realisation of the project, through to getting the building up and running, we stay with our clients, supporting and advising them. For us, this is more than just a business. Behind us there are people and our specific values, including respect for not just other people but also for the natural environment. This is why sustainable construction and our green approach are at the heart of all our activities.

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