New leasing activity in the Ukrainian warehouse market tripled in H1 2024 compared to the same period in 2023, driven by pre-leases of warehouses still under construction, real estate services firm CBRE said.
Leasing take-up jumped to 85,000 square meters in the first half, with pre-leases accounting for 60% of it, according to the latest CBRE Ukraine warehouse market report. The vacancy rate remained stable at 2%, in line with pre-war levels.
"Unlike the previous year when relocations drove demand, expansions in new and under-construction projects led the market this year, accounting for 63% of activity," CBRE said in the report. "Tight vacancy level and space shortages are key market factors at present."
Currently, 205,000 sqm of warehouse space is under construction, with nearly half of that pre-leased, the report said. Rents in US dollars declined 9% on year with the weakening of the local currency. Asking rents for ambient warehouse space ranged between $4.1 and$4.9 while asking rents for cold warehousing averaged $7.4 to $8.9.
"Investment demand in the warehouse market remains robust, with end users actively seeking to purchase warehouses for own use, while developers are focusing on purchasing land plots for long-term development plans," CBRE said.
Last month, Dragon Capital, one of Ukraine's most prominent investment firms, said it sold Ukraine's sixth-biggest warehouse complex, now damaged by the war, to Avrora, the country's biggest retailer in what it described as a "landmark deal" for the war-time era.
The complex includes a 14.4-hectare plot of land, 7,000 square meters of office and warehouse premises, and a 90,000 square-meter building that was destroyed early in the full-scale Russian invasion of February 2022.
About a fifth of all warehouse stock in the Kyiv region was destroyed in the invasion, according to an earlier study by CBRE Ukraine.
