Czech Republic Strong start to year for warehousing

Leasing volumes in the first quarter were slightly above the five-year average, and the total stock of modern industrial space reached 12.4 mln sqm. The highest number of new completions was seen in the Karlovy Vary Region, which also accounts for the largest share of ongoing construction. Leasing activity also increased in Q1, with Prague leading in terms of deals closed. Most demand came from the logistics and transportation sectors, followed by manufacturing companies. In the first quarter of 2025, 155,900 sqm of industrial and logistics space were added to the Czech market, bringing the total stock close to 12.5 mln sqm. The largest share of newly completed space was in the Karlovy Vary Region (54 pct), followed by the South Bohemian Region (22 pct). The largest completed facility was an industrial building in Panattoni Park Ostrov North, built for a tenant from the automotive sector. Construction activity is higher compared to Q1 2024. Industrial development continues across the Czech Republic. As of the end of March, over 1.07 mln sqm of industrial space was under construction. The Karlovy Vary Region leads with 25 pct of ongoing development, followed by the Ústí nad Labem and Central Bohemian Regions, each with 15 pct. The largest project currently under construction is a 233,700 sqm centre in Panattoni Park Cheb, being developed for fashion retailer H&M and scheduled for completion in the final quarter of this year.

Given the measures introduced by the U.S., we may see a shift in manufacturing closer to home, as companies aim to avoid complications related to importing from distant countries. At the same time, we may also witness part of the production capacity returning to the U.S., which remains a key export market for many products. The Czech Republic can still benefit from its strategic location, strong transport connectivity, and well-developed infrastructure, making it an attractive destination for new investments in industrial and logistics real estate. When selecting a location, in addition to accessibility, the availability of a skilled local workforce plays a crucial role.
Jiří Kristek, head of the industrial and retail warehousing team at Cushman & Wakefield

In the first quarter of 2025, the majority of newly signed leases came from the logistics and transportation sector (68 pct), followed by manufacturing companies at 25 pct. E-commerce accounted for just 4 pct last year. Despite ongoing challenges in the automotive industry, tenants from this sector remain active, contributing 13 pct to total leasing demand. Renegotiations represented 62 pct of total leasing activity in Q1 2025, the highest share in the past five years. The last time we saw a similarly high level was in Q1 2020. While pre-leases and new leases dominated in previous periods, the beginning of this year marked a notable shift towards renegotiations.