No more empty industrial properties in the vicinity of Budapest

According to portfolio.hu, Hungary’s industrial real estate market reached a 5.5% vacancy rate in the first half of 2017, which is a record-breakingly low rate since the measurements introduced by the Negotiating Forum of Budapest Estate Advisors.

Out of the 1.95 million m² modern logistic property stock, currently an area worth less than 73 thousand m² is empty in Budapest and its agglomeration, and only four “A” category buildings have a contiguous stock area bigger than five thousand m².

According to Tamás Beck, the director of Colliers International’s industrial property department, the limited supply is the result of the area absorption of the past years and the many speculative developments. Due to the shortage of labour in the building industry, the cost of the work force has increased, thus the cost of construction as well. This is why construction works can last for more than eight months in the case of significant projects.

Moreover, there’s a shortage of the so called “plug and play”, in other words, well-prepared development areas, where constructions could start right away. Currently, the net rent guide prices in the case of big-box logistics are between 3.6-3.9 euro/month/m², while this is 4.5-5.5 euro in the case of city logistics.