Gross demand in the first half of the year was 2.24 million square meters, down 39% year-on-year. Supply was also limited, although a relatively large amount of space (2.6 million square meters) came to market in the first half of 2023. Only 2.13 million square meters of space was under construction, 50% less than a year earlier. The vacancy rate rose to 6.7% at the end of the second quarter.
The volume of investment transactions in the warehouse sector fell by 30% in the first half of 2023, reaching 440 million euros. Major transactions included the purchase of Campus 39 in Wroclaw by P3 from Panattoni, the purchase of 7R Park Poznan East II by DWS Group, and the acquisition of City Logistics Wroclaw II by Trigea Nemovitostni from Panattoni. AXI Immo expects an improvement in the second half of the year, as prices should stabilize and capital returns to the sector.
Gross demand for warehouse space fell to 1 million square meters in the second quarter of 2023. That's the lowest level since 2020. Weaker demand from e-commerce players and deteriorating general economic conditions are affecting the market. The war in Ukraine is also having a negative impact. The supply of modern warehouse space amounted to 30.6 million square meters, and the vacancy rate rose to 6.7%.
The market situation varies by region. Some have seen an increase in demand in the first half of 2023, such as West Pomerania, Świętokrzyskie, Lublin, and Pomerania. However, the largest warehouse markets, such as Mazowieckie, Śląskie, Dolnośląskie, Łódzkie and Wielkopolskie, have seen declines. Developers remain cautious, and space availability varies by location.
All in all, the first half of 2023 was difficult for Poland's industrial real estate sector, with limited demand and investor caution. Nevertheless, an improvement is expected in the second half of the year, and the market situation varies by region. Demand for warehouse space fell, while supply was limited. Vacancy rates have risen, but there are still significant differences between regions. Developers remain cautious, but even in markets with low space availability, they are able to develop projects for the right customers.