In the third quarter of 2014, Prologis leased over 387,000 square meters and acquired 25 buildings with a total area of over 324,000 square meters in Central and Eastern Europe.
Leasing activity
In Central and Eastern Europe, Prologis leased over 387,000 square meters, 57 percent more than in the same period last year. Transactions concluded in Poland accounted for over 38 percent of all lease agreements signed by the developer in the region. The company signed new lease agreements covering 178,000 square meters and renewed agreements with a total area of 173,000 square meters. The remainder consisted of short-term agreements. The vacancy rate in the Prologis CEE portfolio was 7.7 percent at the end of the third quarter.
Acquisitions and investments
In the third quarter, Prologis acquired 25 buildings with a total area of over 324,000 square meters in Poland, Slovakia, the Czech Republic, and Hungary. The logistics facilities were purchased at a price below replacement cost.
Furthermore, during this time, the company completed the construction of four buildings with a total area of 70,500 square meters in Wrocław, Szczecin, and Bratislava, including its first SBU-type warehouse offering small business units. The 18,200-square-meter facility, located at Prologis Park Wrocław III, is already 75 percent leased.
At the end of September, Prologis also announced that it would build a 31,190-square-meter build-to-suit (BTS) facility for the company ČERVA at the recently acquired Prologis Park Prague-Airport. A 30,000-square-meter speculative facility is already under construction at the park.
– Our activity in the third quarter reflects a return of favorable conditions in the Prague, Poznań, and Wrocław markets. However, the recovery is not uniform across the entire Central and Eastern European region, and we are not yet seeing rental rate growth in most markets – said Ben Bannatyne, Prologis Managing Director for Central and Eastern Europe. – In the current economic situation and with growing investment opportunities in the region, our teams are identifying the best investments, thereby guaranteeing us a competitive advantage.
Operating actively in five countries in the region (Poland, Czech Republic, Hungary, Slovakia, and Romania) with a portfolio of 4.1 million square meters, Prologis is the largest owner and manager of distribution facilities in Central and Eastern Europe (as of September 30, 2014).