More Developers Moving Into Logistics Sector
Hello! Parks, the new logistics venture by Futureal.
With logistics looking set to be a clear winner in the post-coronavirus period, developers who have traditionally been active in other mainstream sectors such as office and retail have undertaken industrial projects with an eye on the Budapest agglomeration, regional Hungarian cities and even a Central and Eastern European role.
Perspective industrial demand is strong, with Hungary having the lowest vacancy rate in the region.
ConvergenCE has moved into the industrial market with the preparation of a ready-made product in Tárnok, just 27 km southwest of central Budapest at the junction of the M7 motorway.
Construction of an 8,000 sqm logistics or light industrial facility can be started immediately once a tenant has been sourced, the company says.
The share of retail e-commerce has increased significantly, driven in great part by the epidemic, generating elevated warehouse demand in the domestic logistics market according to the developer.
“As changing needs require quick reactions, not only do we have a valid building permit, but munitions clearance and archaeological excavation of the development area are completed and all utilities installed, so that construction works may start immediately,” says Csaba Zeley, managing director of ConvergenCE.
CBRE has traced a strong pipeline of 200,000 sqm for the Budapest area with no real developer-led market in the countryside. Logistics development could set a record with a completion of 150,000 sqm plus, according to Eston International.
“In Hungary, site selection, acquisition, public works, other infrastructural development and building permitting procedures take an average of 12-18 months,” says Zeley.
“That is why a fully prepared project like this, where all these have already been taken care of, is a huge time saver for any owner occupier or tenant looking for a quick build-to-suit logistic warehouse close to Budapest and the M0,” he adds.
New Player Expanding
A newly established Hungarian industrial developer, HelloParks, a member of the Futureal Group, is continuing its expansion with preparations for the development of HelloParks Maglód (38 km east of Budapest).
A 46,000 sqm facility is being built on a 46-hectare site as part of the first phase of the project, located in the vicinity of M4 and M5 highways and Budapest Ferenc Liszt International Airport.
The complex is scheduled to be handed over by the year end. The EUR 40 million industrial and logistics center has the capacity for a total area of 193,000 sqm of BREEAM accredited space.
This follows the undertaking of development of HelloParks Fót, some 26 km northeast of the capital on a 76-hectare site adjacent to the M0 highway, providing the potential for 330,000 sqm of warehouse and industrial space.
“HelloParks aims to increase Hungary’s regional competitiveness with highly competitive and efficient megaparks that also focuses on sustainability. The developments can strongly support Hungary in becoming a real logistics center, as these facilities can attract new customers with regional outreach to the domestic market,” comments Rudolf Nemes, CEO of HelloParks and former Hungary country manager of CTP.
“By the preparation of the development in Maglód, we have thus taken another important step towards HelloParks’ aim to become one of the key players in the dynamically growing industrial and logistics market, first in Hungary and later on in the region,” he continues.
“The rapid development of e-commerce and the relocation of production capacities have started a new trend of establishing regional EU centers. We are constantly exploring further expansion opportunities in the Budapest agglomeration as well as the catchment area of large rural cities,” Nemes adds.
This article was first published in the Budapest Business Journal print issue of January 29, 2021.
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