Monday, 17 March 2025
Colliers predicts that industrial and logistics assets, along with regional office markets in Poland, will be the most attractive investment opportunities in 2025. According to the report “Highlights 2024 & Predictions 2025. CEE-6 Real Estate Market,” regional office markets, unlike Warsaw, will experience a limited supply of new space until 2026, which is expected to drive increased investor interest. The report also notes that alternative investment strategies such as private debt and mezzanine financing will continue to grow, while credit criteria for non-prime assets will gradually ease. Additionally, Poland’s private wealth sector is increasingly focusing on core+ investments, and the upcoming introduction of REIT legislation, scheduled for 2026, is anticipated to enhance market liquidity and diversify the investor base.
The industrial and logistics sector is expected to see further growth this year, although at a slower pace compared to 2024 and significantly lower than in 2023. This trend may lead to a slight compression of vacancy rates, potentially reaching levels of 6-7% in the first half of the year. Stable demand conditions could encourage developers to negotiate rents, particularly for vacant spaces in older, larger facilities.
In the office market, development activity in Warsaw is projected to rise, with an estimated 230,000 square meters of new office space expected to be completed between 2025 and 2026. In contrast, regional office markets will see limited new supply until 2026, with major projects concentrated in city centers and larger-scale developments. Colliers forecasts a stabilization and gradual decline in vacancy rates in the coming quarters, driven by limited new developments and a growing trend of space withdrawals for modernization purposes. High-standard office buildings will remain in high demand, and tenant activity is expected to remain stable, with an increase in lease renegotiations, particularly for larger spaces exceeding 2,500 square meters. While rental prices in major cities such as Warsaw, Kraków, and Wrocław may see slight increases in 2025, they are expected to stabilize as more office space becomes available.
In the retail sector, the market faces challenges due to a lack of large-format retail projects and increasing market saturation. The availability of prime retail space will be a key factor in attracting major tenants, with competition intensifying for top locations in shopping malls. The new supply in the sector is predominantly driven by retail park formats. In 2024, several retail chains, including Kontigo, ESPRIT, and Eastend, closed all their stores, signaling a shift in market dynamics. Rising operating costs are expected to impact retail operations, leading to optimization efforts and potential increases in rents and service charges in line with inflation.
Despite these challenges, Polish retail chains are continuing their expansion into foreign markets. In 2024, Wittchen Group opened stores in Austria and Romania, Ochnik expanded into Slovakia, and CCC Group introduced its HalfPrice brand in Lithuania and Spain. Colliers forecasts further international expansion of Polish retail brands across Europe in the coming year.
