Sixteen million in fifteen years

Sixteen million in fifteen years
A lot of time has passed since the year 2004, especially when the development of the warehouse market in Poland is considered. At that time, the total warehouse stock reached 2 million sq. m. We are obviously talking about the so-called class A facilities.

However, the definition of a quality standard of a logistics facility has slightly changed over time.

The 2 million sq. m stock, in the form of 10-meter-high buildings, blended in unnoticed with the Polish landscape. This is clearly visible, for example, when travelling to Poznań along the DK2 (E30) route. Industrial properties were not popular with investors, and industrial teams at brokerage companies consisted of only one or a few persons. What about 15 years later? Major changes have taken place in the logistics sector in terms of quality and quantity. Indoor warehouse stock amounted to nearly 16 million sq. m at the end of the first half of 2019. Analysts speak of an 8-fold increase but, to use a more illustrative comparison, it is equivalent to the area of a city like Czeladź in Silesia or Zgorzelec at the border. Nowadays, most of the transport inbound to Poznań is via the A2 motorway. This makes a big difference.

Important role of e-commerce

The approach of ordinary consumers and their awareness of logistics processes have also evolved. One cannot ignore the visible changes in the landscape along Polish motorways and expressways. Warehouses and their facades are becoming more and more characteristic and recognizable, and last mile logistics facilities are also gradually blending into the urban tissue. Not all trends on the warehouse market are directly related to consumers. E-commerce is certainly a bridge between professional real estate market participants and end users. For the buyer, this boils down to efficient processing of an online order, fast delivery and, for the most perceptive ones, taking note of the address of the logistics centre on the shipping label. However, tenants, developers and brokers are under constant pressure from a whole range of factors that are directly or indirectly related to e-commerce.

The future of the warehouse space market

Currently, the future of the professional warehouse market depends on three factors. The first one – new retail – does not only cover digitalisation of the sales process and the impact of the Internet on the retail market. It is more of a change in the way of thinking about retail sales and shifting weight from the chain of brick-and-mortar stores to delivery via specialised logistics and courier companies. The challenges remain the same: price, quality, and accessibility. However, consumers have ever higher expectations regarding these parameters. This is where we come to the second factor, aptly described by two notions: automation and proptech. The real estate industry is wrongly perceived as relatively conservative when it comes to technology. It is true that little has changed in the area of materials and workmanship in recent years. However, commercial real estate is not only the physical product of construction works, but a kind of microsystem, where tenants and end users need to communicate effectively. This is where new technologies come to aid. Among other, they enable automation of logistics processes, which seems inevitable due to the increasing cost of labour. Information technology also supports these processes with efficient and, most importantly, end-user-friendly communication channels.

Let us reflect for a brief moment: can the world of logistics thrive without infrastructure? Obviously not. Road infrastructure immediately comes to mind. In 2018 alone, around 342 km of expressways were delivered and contracts for the construction of around 446 km of motorways and expressways were signed. The warehouse market is one of the main beneficiaries of the development of road transport. However, the time has come for a change in perspective. It is the network of logistics facilities that is beginning to be perceived as the new infrastructure. It will not be possible to meet the ever-higher needs of the consumers without a coordinated network of facilities and a number of partners in the supply chain, cooperating with one another. From the perspective of the entire economy, viewing logistics as infrastructure is important in strategic planning and enables sustainable economic development in all regions of Poland.

AUTHOR: Tomasz Kostrzewa

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