The modern logistics and industrial spaces stock in Romania has reached 3.8 million square meters at the end of 2018

Of the total of this stock, 81% are in Class A buildings and 70% in properties near regional cities. The vacancy rate reached 3.7%, amid the high demand, the small size of the completed projects and the large number of pre-lease agreements signed for the premises still under construction.

In 2018, total rental activity, excluding renewals and renegotiations, reached 270,000 m², 11% less than in 2017. In 2019 the construction in the sector will have an even faster pace than in 2018, with deliveries of 607,000 m² expected, of which 27% are located in regional cities and 55% are
pre-leased.

The total area traded in 2018 is 509,000 m², of which 45% were for storage companies, 35% were leased by distribution companies, 15% by logistics players and 5% by manufacturing companies. The local market was dominated, in 2018, by major international developer projects such as CTP Invest, WDP, Logicor and P3, which absorbed 61% of total demand. Of the total new construction completed in 2018, 11% were speculative. The strategy of developers and investment funds active on the local market is still prudent, with many semi-speculative constructions. Semi-speculative developments are projects built upon requests received either from existing customers or from new tenants but also with a speculative component. Thus, to the surface built upon request is added about 20% - 50%, as developers want to be ready for possible new requests. The high level of demand determines the high rate of pre-renting, most of the premises being contracted before completion.

The retail segment was the main growth engine for the industrial and logistics market in 2018, and the most important surface transactions were signed in WDP Industrial’s parks in the second half of 2018. Thus, Carrefour signed for the lease of 65,500 m² in the Brazi and Deva parks, and P & G will occupy 25,600 m² in Timisoara.

In Bucharest the projects are found in all four cardinal points of the city, but the western part has already become the pole of industrial and logistics space, with 74% of the space stock here. The northern side has an important potential, with 16% of all buildings being built in this area, and further major developments are announced in the future. Contracts of pre-lease accounted for 41% of the area traded near Bucharest in 2018, and 68% of them are for premises located in the northern area of the city. Approximately 440,000 m² will be built in 2019 in the areas near the capital.

Prime rent (reference rent for class A projects located in the best areas) in 2018 kept a constant level of 4.1 euro / m² / month, while the average rent was at 3.5 euro / m² / month.

For 2019, 607,000 m² are announced to be delivered nationwide, of which 47% represent CTP developments, the market leader, and the remaining 53% are construction of Helios, Element Development, Transilvania Construcţii and Zacaria.

"In 2018, it was built at an alert pace, even if below the 2017 level, but we expect the segment of logistics and industrial spaces to have the most significant growth this year. An important direction, taking place in 2018, which will continue to be present in 2019, is the increase in the e-commerce segment in the share of rental requests. Infrastructure is one of the key factors in the location of new logistics and industrial projects, so we expect that the road improvement works that will take place this year will also attract new constructions. Semi-speculative projects will also be large this year, just like in 2018, even though many projects will be built to meet tenant specifications, "said Andrei Jerca, Account Director | Industrial Services of CBRE Romania. (source: CBRE)