According to the Savills Global Warehousing Costs 2024 analysis, Prague is the only European city where the total costs associated with operating premium industrial properties decreased year-on-year, by 1.8%. In contrast, these expenses increased in neighbouring Poland, with rises of 5.7% in Wrocław, 5.8% in Warsaw, 8.7% in Katowice, and as much as 11.2% in Poznań.
The analyzed costs include headline rent for modern warehouse spaces (excluding any incentives that landlords often provide to tenants), local taxes, and service charges (excluding utilities consumed by the tenants themselves). In Prague and Warsaw, these total warehouse rental costs are nearly the same, with Prague at €99/m²/year and Warsaw at €97.86/m²/year. The year-on-year decrease in total costs on the Prague market was mainly due to a correction in rental levels, which began to drop from their peak in 2023. On the other hand, in 2024 there was an increase in property taxes, which impacted some industrial parks (and their tenants) more than others, depending on the specific location.
"When looking for a suitable location for the long-term lease of premium industrial spaces, several factors need to be considered. In addition to transport accessibility, the stable legislation, the technical specifications of the hall, or the size of the unit, the costs play a crucial role. Our report shows that additional service charges or taxes in a given location can increase the rental cost by 5 to 11% annually, as is the case in Poland," says Ondřej Míček, Head of Industrial at Savills.
The most expensive area for leasing premium warehouse space is the United Kingdom, which occupies the top four spots. London ranks first overall with €446/m²/year, followed by the Midlands region at €220/m²/year, the North West of England at €198/m²/year, and Yorkshire at €182/m²/year. In neighbouring Germany, rental prices, including taxes and service charges, range from €105/m²/year in Frankfurt to €110/m²/year in Hamburg.
Paul Tostevin, Head of Savills World Research, comments: “Warehousing has recently benefitted from a booming logistics industry and the global diversification of manufacturing, fuelling significant rises in property-associated costs, but we’re now seeing growth slow as higher supply and more moderate demand is helping to rebalance many markets. Big macro trends such as reorientating supply chains and rising ecommerce rates aren’t going away, however, so we expect to see further movement in costs in key locations in the coming years.”