C&W sees upswing in CEP market
Hungary has seen continuously rising commercial sales volume since the 2009 financial crisis, and - apart from seasonal cycles - households have shown a trend of rising consumption, Cushman & Wakefield said today in an overview of the CEP market. The firm notes that overall debt of the Hungarian population fell from HUF 11 trillion in 2009 to HUF 7 tln by 2016.
In line with a positive tendency seen in Western Europe, the Hungarian e-commerce segment is also experiencing a boom, according to C&W. While the turnover of Hungarian online commerce totaled HUF 19 billion in 2005, this had grown to HUF 137 bln by 2010. Furthermore, in 2015 the total domestic e-commerce volume topped HUF 319 bln, which is 4.1% of the overall commercial activity, C&W adds.
The significant beneficiaries of the trend are companies who provide so-called “CEP” (Courier Express Parcel) services, with many international delivery firms already represented in Hungary, the press statement notes. Some 42% of all of e-commerce purchases in the country were delivered by CEP companies in 2015, according to the figures of C&W.
As far as commercial real estate is concerned, C&W considers the upswing of this particular segment is clearly noticeable: DHL Express, owned by the German postal company, recently announced a cooperation with Budapest Airport in order to develop a new 13,000 sqm logistics center within the area of the airport. UPS Hungary Ltd. is also planning to begin operations in a newly developed building close to the airport, in Vecsés. Additionally, C&W in close collaboration with its exclusive client DPD Hungary Ltd., has recently completed the expansion of the firm’s logistics base with the addition of another operations hub located in south Buda.
Professionals at Cushman & Wakefield forecast further momentum in the field of e-commerce, escalating competition between CEP providers, and rising commercial value of industrial/logistics buildings suitable for such activities, as more developments are already in the pipeline
“The positive market sentiment, the stable demand, and the businesses’ aim to expand their activities and the efforts of existing tenant’s in order to gain new businesses, all project further speculative and ‘BTS’ (build-to-suit) developments … The growth of the Budapest stock boosted by the speculative and ‘BTS’ developments over mid- and long-term is clearly shifting the demand towards greenfield sites also causing an increase in such type of transactions and causing a moderate but steady rise of land prices,” said Gábor Halász-Csatári, head of the industrial department at C&W in Hungary.
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