Nearshoring becomes a reality: production increases in logistics & industrial activity

Nearshoring becomes a reality: production increases in logistics & industrial activity

Nearshoring becomes a reality: production increases in logistics & industrial activity 900 600 BUCHAREST REAL ESTATE CLUB

16.10.2023

Bucharest is slowing its logistics development activity, with a share of 27% of the 233,000 sqm delivered in the first half of the year, while 73% goes to regional centers, as shown by CBRE Romania data presented at the OMNICHANNEL CONFERENCE recently organized by BREC & PRC.

A total of 560,400 sqm were traded in the first half of the year, of which 2% were warehousing, 55% logistics, 21% manufacturing and 22% other activities. “The share of production activity in total rental transactions increased from 9% in the first half of 2022 to 21% in the same period of the current year. In addition, the logistics segment stagnated, while warehousing and other I&L segments declined. Nearshoring is here and you can see it in the numbers,” explained Daniel Cateliu, Director, Industrial & Logistics, CBRE Romania.

“This year we noticed the trend of compliance with fire prevention rules and, consequently, the increase in demand from tenants who were operating in old and non-compliant premises. By the end of the year, we will have a 0% vacancy rate on all VGP stock in Romania”, explained Dana Bordei, Commercial Country Manager, VGP Romania. The Belgian investor has a new project in the works in the A2 area. “We see a lot of potential in the A2 area, in terms of traffic but also for the labor pool in the area”, explained Dana Bordei.

During the pandemic, the e-commerce sector experienced accelerated growth, which moderated. “We expect the e-commerce market to reach the level of 7 billion Euros this year, but everything depends on Black Friday, the most important annual event in this sector. We expect the longest Black Friday this year, with promotions that will last two weeks”, explained Raluca Radu, Country Manager, Answear, adding: “In Romania, the e-commerce market represents 10% of the total trade, while in Poland the share is 20% and in the UK 30%. The growth potential is still there.”

Globalworth’s logistics portfolio has exceeded 400,000 sqm. “In June 2023, Globalworth’s industrial portfolio had an occupancy rate of over 90%, given that, in the last 18 months, we delivered 123,000 sqm. Banks are open to financing sustainable and energy-efficient projects,” said Oana Cojocaru, Sustainability Director at Globalworth.

“At Buftea we have already developed 120,000 sqm, of which 50,000 sqm were sold to Fortress. Our strategy is to continue the development of the hub and we are confident that by completing the works on the new A0 belt of Bucharest, the weight of the logistics poles in the capital area will change substantially”, explained Andrei Jerca, Managing Director, ELI Parks, adding: “Outside of Bucharest last year we started the first construction site in Ploiesti and this year we are continuing the second one. Our development direction is also heading towards the Moldova area, also encouraged by the improvement of the infrastructure, where we already have two projects in execution in Bacău with a total area of 45,000 sqm, and our strategy provides to open another new city”.

The managers present at the conference mentioned that in order to attract greater investments in production capacities, in addition to completing major infrastructure projects, Romania needs massive investments in increasing the capacity of utility networks (electricity, gas).

Another trend discussed at the conference is the need for new mixed-use real estate products that combine retail parks and last-mile logistics developments.