The Greater Budapest area is well supplied with modern logistics and industrial space of various types of facilities. Other regions in Hungary have poor availability and are more focused on built-to-suit developments – with the exception of the Northern counties.
The market in and around the capital has been favorable for tenants for three years already as vacancy stuck at a relatively high level. Countryside markets show a mixed picture with increasing availability in the Miskolc region but still short supply in key cities like Györ and Kecskemét.
Development process is very quick and effective and many landlords own plots with building permit in place in the most developed areas.
Labour availability highly varies across the country from 6% in the more industrialized Györ region to 16% in Miskolc region.
Office demand decreased by double-digit rate and pushed net absorption into negative. This makes vacancy increase above the 21% line despite lack of new completions.
Industrial demand jumped to historical high in Q3 which helped vacancy decline to under 20%. Year-to-date net absorption increased on last year.
After a depressed completion volume this year, retail pipeline is building up in Budapest and across regional cities. Best high-street locations mark increasing interest and hence potential rental increase.
Investment volume is unchanged on Q2 with EUR 84 million since there hasn’t been a new transactions recorded since early this year. Prime logistics yield moved out by 25 bps for the second time this year.