The Czech industrial real estate sector delivered a robust Q2 performance, with 189,700 sqm of new leases signed. That’s helped disperse lingering oversupply pressures that emerged during the post-pandemic construction boom. 108 Real Estate reports that total gross take-up including renegotiations reached 337,625 sqm between April and June, outpacing Q1 figures.
Head of Research Michal Bilý says that while the premium industrial market bottomed out in Q1 2024, it’s uncertain how strong a rebound we can realistically expect. United States trade tariffs are moderating the optimism, as are continuing geopolitical tensions. “We’re observing a retreat of positive sentiment in the Czech industrial market,” he says.
“In the second quarter of 2025, we again witnessed lower performance of the Czech premium industrial market, with new leases hitting below-average values. The first half of the year thus showed roughly the same figures as the first half of last year.”
One of the clear signals from recent deals is that occupiers are increasingly willing to accept either higher rents or less accessible locations in exchange for superior technical standards. That’s a change from the immediate post-pandemic period when cost-optimization was king.
The logistics and warehousing sector led new leasing activity at 76,600 sqm, followed by wholesale, e-commerce, and retail companies at 63,000 sqm. Manufacturing firms accounted for 37,000 sqm, while service providers took 12,800 sqm. Yusen Logistics’ 43,473 sqm commitment at P3 Lovosice Cargo topped individual transactions, with ROSSMANN’s 31,000 sqm lease at CTPark Prague North close behind.
SOME OVERSUPPLY PERSISTS
Despite the improved pace of leasing, structural challenges remain evident. Total modern industrial stock reached 12.1 million sqm by quarter-end, expanding to 12.65 million sqm by including 548,000 sqm of semi-completed, shell-and-core space. That leaves 511,000 sqm of ‘immediately’ available space, or 4.22% of the total.
The Plzeň region boasts the highest concentration of vacant space, while new construction activity has shifted toward the Karlovy Vary Region, where 270,000 sqm is currently under construction. Central Bohemia has 264,000 sqm on the way while another 262,000 sqm is being built in the Moravian-Silesian region.
GRADUAL STABILIZATION
Rent levels have held steady since the beginning of the year, something Bilý suggests means that the fierce competition among developers that characterized 2023 may be moderating. He says there’s been a decline in spec construction, as global logistics players are prioritizing warehouse completion speed over pure cost considerations.
The levels of output we’re seeing now looks like a return to the pre-Covid levels, when quarterly demand often came to around 200,000 sqm. The difference is that this old level of supply now services a significantly expanded stock base, raising questions about long-term absorption capacity in a maturing industrial landscape.
Have we reached some kind of saturation point? “Possibly,” says Bilý. “But it’s a difficult question to pin down. There are fewer of the smaller deals these days, but then we have more of the huge deals like Amazon in Kojetin or BMW in Mošnov. Those bump up the demand figures, but if you take them away, there’s less happening.”
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