Budapest Research Forum (BRF, of which Eston International is a member) reports its freshest industrial property market report on the 4th quarter of 2012.
By the end of 2012 modern industrial stock in Greater Budapest reached 1,822,933 sq m following the handover of three new buildings with a total area of 16,448 sq m. Two of these had been pre-leased partially or entirely before the completion already.
After the record-breaking statistics of Q3, last quarter’s demand remained quite modest. Total leasing activity (TLA) registered 22,181 sq m – the lowest on record this year. 52% of TLA was made by new leases or expansions, while renewals accounted for 48%, down from 62% last quarter.
With the exception of Waberer’s renewal, there was no lease signed for space above 5,000 sq m in last quarter, creating a remarkable change compared to the previous quarter. Average deal size went down from 6,400 sq m in Q3 to 1,300 sq m in Q4.
For the first time this year, total stock increased in Q4 when three parks expanded, each by adding a new building. Airport City’s was 6,884 sq m, South-Pest BP’s was 5,817 sq m and Europa Center’s was 3,747 sq m. The latter remains vacant at present.
Average vacancy rate in logistics parks did not change in Q4, remaining at 19.1% following the sharp decrease seen in Q3. In case of city logistics the rate increased to 21.7%. Measured against the total industrial stock in Greater Budapest, the rate stands at 19.4% with 353,350 sq m space being vacant at the end of 2012.
Total leasing activity on an annual level reached 354,743 sq m, up by 8% on 2011. However renewals’ share increased further, making take-up in 2012 short on the previous year’s level. In the first half 2012 net absorption was negative but it turned strongly positive in H2. Annual net absorption reached 40,652 sq m.