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News Release

Budapest

Will new developments start on the Budapest industrial market?


Budapest, June 18, 2015 – Vacancy rate has further decreased on the Budapest industrial market – according to JLL’s latest Q1 2015 Budapest City Report.

The industrial vacancy rate has been decreasing in the last six consecutive quarters. It is down by 680 bps compared to the corresponding period of the last year and reached 14.5% in Q1 2015. There was no new industrial property delivery in this period, the modern industrial stock is 1,885,610 sq m.

After the outstanding performance of the industrial real estate market in 2014, the positive sentiment continued in the first quarter of 2015. Although the take up volume have decreased compared to the last quarter of 2014, which usually shows a stronger performance, the results in the first quarter of 2015, however, show a 55% better performance compared to the corresponding period of 2014 and the emerging occupier enquires predict the continuation of this tendency. 

According to Roland Kis, Head of Industrial Department at JLL, both logistics and manufacturing segments have been strengthening in the first quarter and this market recovery can be observed in Budapest and in the countryside as well. Another interesting and gratifying observation is that the greater demands over 10,000 sq m (the expansion applies to both new and existing areas), appear in the market in increasing numbers, which will stimulate new speculative and BTS developments due to the limited supply. As a result, some increase of rental levels may start in the properties of the modern industrial stock.  

“The Budapest industrial market has shown an unprecedented improvement during the last year. This has been obviously recognised by foreign investors as well and gained increasing interest towards industrial assets. Due to the favourable market environment, demand for development sites may gather momentum and new entrants may appear on the market” – said Rita Tuza, Head of Research at JLL Budapest.