Industrial Market Czech Republic Q1 2024

Summary of current data:

„In the first quarter of this year, we recorded the lowest take-up in the last 15 years. Year-on-year it decreased by 54%, and quarter-on-quarter by 61%. The strongest demand remains in Prague and its surroundings, with only 100,000 sq m of new lease agreements signed across the Czech Republic. The standard duration of new contracts remains at a five-year period, with continued primary emphasis from both tenants and landlords on securing sustainable and energy self-sufficient properties. Only 136,500 sq m of new space was completed, representing a year-on-year decrease of 47%, however, there is an increase in buildings in the shell and core state. Developers are moving away from speculative construction and are fully focused on occupying new, previously unoccupied spaces. In this regard, their flexibility in terms of incentives and unit prices is increasing. The current rent level of 5.00 – 7.70 EUR sq m /month represents a year-on-year decrease of 4%, and although vacancy is increasing due to the drop in take-up, it is still at a very healthy level. The market continues to add more subleasing options even in units of 10,000 sq m sizes. There is a market correction evident back to the pre-COVID levels."

MARKÉTA VRBASOVÁ, DIRECTOR, HEAD OF INDUSTRIAL & LOGISTICS

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