In the first quarter of 2017 four developments were handed over increasing new supply by 40,230 sq m, including Budapest Dock Szabadkikötő Phase II and III (19,200 sq m), and two buildings of Prologis Park Budapest Sziget (21,030 sq m). One industrial park was deleted from stock due to owner occupation.
The modern industrial stock in Budapest, and its surroundings stands at 1,961,480 sq m at the end of Q1 2017.
Total demand amounted to 71,600 sq m in Q1 2017, which is slightly under the 5-year average of the first quarters’ leasing activity (73,830 sq m). Renewals accounted for 34.5% of the total take-up, while the share of new lease agreements made up 30.8% and expansions 16.5%. Two large pre-leases were signed during the quarter, totalling 13,000 sq m and representing 18.1% of the total demand of Q1 2017.
BRF registered 25 industrial transactions in the first quarter, out of which one lease agreement reaches 10,000 sq m. The average deal size was 2,864 sq m which is in line with the average level of the previous five Q1 periods.
96% of the leasing activity was recorded in logistics parks where the average deal size was 3,440 sq m. The average deal size in city logistics schemes equated to 564 sq m.
The largest pre-lease was signed in CTP-Biatorbágy, on 10,000 sq m. The largest new lease was signed in Mile Logistics Center on 8,365 sq m. The largest renewal was a 9,760 sq m deal in Prologis Park Budapest-Gyál and the largest expansion took place in Akácliget Logistics Center on 3,550 sq m.
The vacancy rate declined 2.2 percentage points q-o-q reaching a record low of 5.9% at the end of Q1 2017. In total 115,162 sq m is currently vacant and only one scheme offers more than 10,000 sq m available adjacent space.
Net absorption remained positive over Q1 2017 and amounted 67,346 sq m.