Bucharest’s industrial space take-up rose by 40 percent in the last half of 2012 compared to the first half of the year, while the industrial stock grew by 2 percent, reaching a total of 980,000 sqm, according to a CBRE report on the local industrial market in the last semester of 2012.
“The industrial sector posted a 3.1 turnover increase last year compared to 2011 and generated a quarter of Romania’s GDP which goes to show increasing interest in this sector. This is why this year, given the political and economic stability, we expect developers to resume industrial park projects which have been postponed for several years,” said Marian Orzu, head of the industrial department at CBRE Romania.
In 2013, tenants will mainly look to build-to-suit projects in buildings which are optimized for their specific activities and a stable rental market will allow tenants from low-performing spaces to move into class A ones, he added.
In a report on the local real estate market in Q4 2012, Jones Lang LaSalle Romania forecasts that although there continues to be a preference for Bucharest’s main industrial hubs, Ploiesti, Timisoara, Cluj and Constanta are emerging as second-tier centers. Moreover, in addition to traditional occupiers such as 3PL companies and automotive related firms and suppliers, Romania has started to attract manufacturers. However, despite the country’s advantageous geographical position, this sector is in an incipient state, mainly because of a lack of proper road infrastructure.
Jones Lang LaSalle Romania estimates the modern industrial stock in Romania will reach 1.8 million sqm, as of Q4 2012, with up to 55 percent of the stock located in Bucharest’s industrial hubs. In Romania, over the whole of 2012, the modern industrial supply increased by approximately 130,000 sqm (including all types of industrial premises such as speculative, built-to-suit, pre-let and owner-occupied units).
The major built-to-suit and owner-occupied industrial premises delivered in the last quarter of 2012 include the 20,000-sqm built-to-suit unit occupied by DSV in Bucharest West, the Lufkin Industries Oil Field Division owner-occupied facility within Ploiesti West Park of approximately 35,000 sqm (in three main buildings), as well as the 16,000-sqm built-to-suit unit occupied by Schlumberger in Ploiesti West Park, according Jones Lang LaSalle Romania data.
Another 144,000 sqm could be delivered this year and next outside Bucharest, according to CBRE representatives. An additional 77,000 sqm remains in the planning phase due to lack of financing.
There were about 22 transactions in the last semester of 2012, involving a total surface area of 89,000 sqm, says CBRE. Deals involving Bucharest stood at 38,000 sqm, outside the capital the total reached 32,000 sqm and the remaining 24,000 sqm represented direct transactions between owners and tenants.
The largest deal in the second half of 2012 was grocery retailer Profi renting 15,000 sqm for a logistics center in Log Center Ploiesti, followed by the14,000 sqm secured by motor industry player Faurecia in the Dacia Pitesti platform. Other large transactions were the 7,500 taken by KLG Europe Logistics in Olympian Park Timisoara and Meitav which rented 6,000 sqm in Pantelimon Logistics Center.
The capital attracted most investments in industrial developments in H2 2012 (44 percent) followed by Ploiesti (19 percent), Pitesti (16), Timisoara (15 percent), Ramnicu Valcea (5 percent), Arad (3 percent) and Constanta (1 percent).
There were no major changes to prime rents in the second half of 2012, which remained between EUR 3.75 and EUR 4 per sqm, depending on the surface rented. Source: Business Review Romania