Poland Poland records the highest warehouse take-up in Europe

H1 2024 ended with total take-up at nearly 2.7 mln sqm, up by as much as 22 pct year-on-year.

In the three months to June 2024, tenants leased 1.76 mln sqm of warehouse space, more than making up for the poor performance in Q1. This marked the best result for warehouse take-up in Europe and the second time when Poland outpaced Germany for quarterly leasing volumes. It is also notable that large leases for 20,000-130,000 sqm accounted for 56 pct of Q2 total.
Damian Kołata, Partner, head of Industrial & Logistics/E-Commerce CEE, Cushman & Wakefield

The three largest leases of Q2 were recorded in Wrocław and Bydgoszcz-Toruń. In the Wrocław region, an international e-commerce platform took an additional 126,000 sqm while LX Pantos renewed and expanded its lease to 100,000 sqm. The third transaction saw LPP Logistics lease 104,000 sqm of warehouse space near Bydgoszcz for online order fulfilment.

Similarly to last year, new leases and expansions which totalled 1.66 mln sqm accounted for around 60 pct of the leasing volume (up by 24 pct year-on-year), with the remaining 40 pct transacted under renewed contracts.

The breakdown of net take-up by sector reveals significant changes: retailers and e-commerce companies raised their share of net take-up to 34 pct while logistics providers saw theirs fall from 36 pct in H1 2023 to the current 22 pct. Looking ahead, demand is expected to be driven in the long term by the continued growth of e-commerce, the increasing adoption of ESG strategies and thereby the flight to quality, as well as nearshoring trends.
Adrian Semaan, market analyst, Cushman & Wakefield

A marked decline in speculative construction

In June 2024, Poland’s total industrial stock stood at 33.52 mln sqm, up by 9 pct year-on-year.

The Polish industrial market continues to enjoy brisk expansion with 1.64 mln sqm of modern warehouse space delivered in H1 2024. A similar volume is scheduled for completion in H2 of this year, signifying that Poland’s total industrial stock is firmly on course to exceed 35 mln sqm in the near future.
Damian Kołata

New supply in Q2 2024 reached almost 786,000 sqm, of which 44 pct remained vacant. This pushed warehouse availability up to 2.80 mln sqm at the end of June. The overall vacancy rate edged up to 8.3 pct (up by 1.6 pp y-o-y and 0.1 pp q-o-q) - its highest level since September 2020 (8.5 pct). The largest upward movements in vacancy levels in the last 12 months were recorded in Lubuskie (up by 8.6 pp to 19.3 pct), Pomerania (up by 5.6 pp to 7.1 pct), Lesser Poland (up by 4.9 pp to 6.1 pct) and Łódzkie (up by 3.1 pp to 10.8 pct). Regions reporting negative growth were Western Pomerania (down by 3.4 pp to 4.0 pct), Silesia (down by 1.9 pp to 5.9 pct) and Greater Poland (down by 1.0 pp to 5.9 pct).

Development activity slackened slightly, which - coupled with a sharp decline in speculative construction - is likely to push vacancy rates down in the next 9-12 months. In Q2 2024, work began on the construction of approx. 460,000 sqm of warehouse space, of which only 184,000 sqm was being built speculatively. This brought Poland’s total development pipeline to 1.99 mln sqm at the end of June.
Adrian Semaan

Of all the regions, Lower Silesia is the hot spot for construction activity with 568,000 sqm under way, of which as much as 40 pct is being developed for an international e-commerce platform in P3 Wrocław in Kąty Wrocławskie. Q2 2024 saw the highest number of new starts in Silesia (156,000 sqm, of which 81,000 sqm is speculative space) and Mazovia (146,000 sqm, including 67,000 sqm of speculative projects).

Stabilization with effective rents under slight downward pressure

In H1 2024, monthly headline rents remained flat at EUR 3.60–6.50 per sqm for big-box warehouses and at EUR 5.00–7.50 per sqm for SBU/City Logistics projects. With financial incentives such as rent-free periods or space adaptation contributions offered to tenants, effective rents can be lower than headline rental rates by a maximum of 15-25 pct.

The industrial sector is filling vacancies

In Q2 2024, the highest labour rates for production workers in terms of basic remuneration were recorded in Poland’s southern provinces (Lower Silesia, Lesser Poland and Silesia) - they stood at more than PLN 28 per hour.

More than 20 pct of companies across Poland offer production workers basic hourly rates in excess of PLN 28, with over 22 pct providing the most common rate of PLN 26 per hour. Less than 2 pct of employers offer PLN 34-36 per hour. It is worth noting that more than 84 pct of workers in this sector are Polish while Ukrainian citizens account for nearly 14 pct of the workforce, being the second-largest group by nationality.
Dagmara Żuromska, Strategic Business Development senior manager, Randstad Polska

The percentage of companies conducting recruitment rose significantly compared with Q1 2024, with the key driver still being the need to fill vacancies resulting from employee turnover. Recruitment processes are much more often initiated by large employers, particularly in such sectors as retail, logistics and construction; and according to respondents, the more there are such processes, the more difficult it will be to find suitable job candidates.

Employee turnover is obviously impacted by overall job satisfaction. It is worth noting that job satisfaction levels have slightly improved in transport, logistics and manufacturing. 80 pct of transport and logistics employees and 74 pct of manufacturing workers are either very or quite satisfied with their current jobs and nearly half of those working in these sectors are not looking for new employment at all.
Dagmara Żuromska, Randstad