Poland has more than 27 million sqm of industrial and logistics space after the third quarter of 2022. This is 19 percent more year-on-year. As many as seven regions currently have more than 1 million sq. m. of such space. Logistics is not slowing down and has an appetite for more. Despite the difficult macroeconomic environment, 58 percent of the sector’s representatives expect to increase turnover, the same percentage plans to hire, according to CBRE and Panattoni’s “Confidence Index 2022” report. The challenge will be the declining availability of space, as while e-commerce interest in warehouses is waning, there is a boom in manufacturing.
“Surrounded by growing economic challenges, the most important of which are inflation, higher costs of doing business or declining orders, the logistics sector remains strong and set for dynamic growth. Most of the industry’s representatives are assuming an increase in turnover and, consequently, in employment. This is currently quite unique, as most sectors turn on survival mode, meaning that they set their sights on maintaining the current situation, both in terms of turnover and employment. This proves that the momentum that the industrial and logistics sector has gained in the pandemic is holding up, and for the time being this will not change,” says Anna Bielacka, senior consultant in the consulting and research department at CBRE.
More and more warehouses, but growth slows down.
A report by CBRE and Panattoni summarizing the third quarter of 2022 shows that the stock of industrial and logistics space in Poland exceeded 27 million sqm. This is a year-on-year increase of 19 percent. In the second quarter of this year. Szczecin surpassed the 1 million sq. m. mark for this type of space, which means that we already have seven regions in Poland with this amount of warehouses. There is still 4 million sq. m. under construction, 8 percent more than a year earlier. However, in the third quarter there was a 9 percent drop in space under construction compared to the previous quarter.
“Space under construction may decline in the future due to the fact that banks financing investments expect a higher level of rental security than they have so far. The third quarter was the first time in a year and a half that less than 1 million new construction starts were made. This will affect availability, which will be a problem for many sectors. Admittedly, the e-commerce industry is now less interested in industrial and logistics space than in the pandemic, but that space is being filled by manufacturing, which is becoming an increasingly important component of demand. Their contracts already account for 18 percent of the total,” adds Anna Bielacka of CBRE.
Most entrepreneurs in Poland are looking at the next year with great trepidation. However, it turns out that fear does not apply to logistics representatives. According to the CBRE and Panattoni “Confidence Index 2022” report, those involved in the sector mostly expect an increase in turnover next year (58 percent). A decrease is expected by 26 percent, while 16 percent believe turnover will remain unchanged. The results differ among groups of respondents. The vast majority, 84 percent, of logistics companies believe turnover will increase or remain the same, 64 percent of trade and manufacturing companies are of the same opinion, while at least a third expect turnover to decrease.
“Growth forecasts in the logistics industry and strong demand among operators for industrial space confirm that in challenging times, with supply chains breaking down, having an adequate logistics and warehousing base is a key element to ensure business continuity. In addition, Poland, thanks to its strategic location in the center of Europe, becomes an ideal place to conduct operations serving the entire continent. Well-developed infrastructure, access to attractive locations and still lower operating costs than in the west attract companies with both local, regional and global reach,” says Marek Dobrzycki, Managing Director at Panattoni.
Employees in the industrial and logistics sector should not fear for their jobs because job cuts are assumed by only 6% of companies. Most plan to look for new employees. When asked whether they plan to increase or decrease their workforce in the next 12 months, representatives of the sector indicate 58 percent will increase and 36 percent will maintain employment. Interestingly, last year 41 percent of respondents planned new hires, an increase of 17 percentage points. As with turnover growth, logistics companies stand out, with 68 percent expecting an increase in employment and no plans at all for reductions. Among retail and manufacturing companies, 48 percent want to hire, 40 percent will not change anything, and 12 percent anticipate a slight decrease in employment.
