Baltic warehousing and logistics property market back on its feet

The Baltic warehousing and logistics property market is getting back on its feet and strongly moving forward, with the prime properties showing the lead.

After painful adjustments to the new market conditions during the crisis, which caused sharp rent rate decreases and dramatic vacancy increases (especially in the speculative and lower class W&L properties), the W&L property market experiences a robust come-back. The prime W&L vacancies in the Baltic capitals are as low as 5% in Vilnius (LT) and 10% Tallinn (EE) and Riga (LV), whereas the prime rent rate increases for top class premises are expected to be of 3-4% p.a. in Vilnius and Tallinn, and up to 10% p.a. in Riga in 2012-2013. In Vilnius, the companies which require modern W&L spaces larger than 3,000 sq. meters find it hard to lease adequate premises in prime W&L property market, unless they are willing to go for Built-to-Suit solutions or can accept the premises of lower quality/location parameters.

To illustrate the case, a strong Lithuanian developer Ogmios recently completed the third stage of the Airport Business Park - a W&L complex of over 22,000 sq.m located in front of the Vilnius International Airport. Even before the completion, the property was fully preleased, with two parts being Built-to-Suit solutions for DHL and AVON, and the third leased by Hellmann and ACE Logistics, among several other smaller tenants. The complex also includes a retail part of over 2,000 sq.m which was also preleased by Norfa, one of the largest Lithuanian retail chain operators. The developer intends to sell the Airport Business Park, with Newsec as the sell-side advisor.

About Ogmios
Ogmios Group is one of the leading real estate developers in Lithuania focusing on commercial real estate. Ogmios Group owns or manages more than 300,000 sq. metres of commercial real estate located in 5 major Lithuanian cities, worth more than EUR 200 million. Being among the top Baltic market players, Ogmios developed lasting successful relationships with many office, retail and logistic tenants, including DHL, AVON, Daewoo, ACE Logistics, Hellmann Worldwide Logistics, Systemair, VBH, Onninen, and many other.

About Newsec
Newsec is Northern Europe’s only full-service company in the property sector, with 12 offices in Lithuania, Latvia, Estonia, Finland, Sweden, Norway and Kaliningrad (Russia). Newsec offers services to property owners and companies that lease or own their properties. Newsec has about 500 employees and has recently provided advisory services in transactions with a total value of more than 9 billion euro. Annually we valuate properties worth more than 65 billion euro and manage more than 1,000 properties with a total value of more than 10 billion euro. Through our well-maintained international network of 6,000 consultants, we can offer our services in the global market. This makes us Northern Europe’s only full-service property house in the property sector, which provides the company with a unique ability to forecast the future.
The first issue of the comprehensive market analysis Newsec Property Outlook was published in 2001. Get your own copy of the latest edition at www.newsec.com/npo

Contact for more information:
Neringa Rastenyte
Head of Transactions, Baltics
+370 686 17 468
n.rastenyte@newsecbaltics.com  

www.newsecbaltics.com