Industrial real estate market in Eastern Europe – Malgorzata Czepel, Director Industrial & Logistics at CBRE Poland

1. market overview & trends

How would you describe the current situation on the industrial real estate market in Poland and Eastern Europe?

After a very challenging 2024 and a sluggish first half of 2025, I see a significant improvement in the Polish industrial real estate market. The trend that started at the end of last year has clearly strengthened at the beginning of 2026. Although the statistics do not yet fully reflect this, we are receiving significantly more inquiries from potential clients. Importantly, these inquiries are not only for smaller spaces, as was the case for almost a year and a half, but also for large units of 30,000 to 40,000 square meters and in some cases even over 100,000 square meters. This indicates a renewed confidence on the part of investors.

Around 90% of these inquiries come from foreign companies from various sectors, which underlines Poland’s continuing attractiveness. I am also observing a change in behavior among project developers: After years of caution, almost 40% of new projects were launched speculatively in the fourth quarter of last year. For me, this shows that project developers are confident that demand will make up for the current vacancy rate. The recovery of the overall market may not be very fast, but I am cautiously optimistic. There are signs of stabilization and I expect more contracts to be signed in the coming months.

What overarching trends are currently shaping demand for industrial and logistics space?

In my opinion, the most important driver at the moment is the need to serve European customers more efficiently. International companies, especially from China and the US, are increasingly recognizing that it is more advantageous to produce in Europe rather than ship from overseas. They save on logistics costs, shorten delivery times and stay closer to their markets. For European companies, the motivation is often cost optimization – labor costs and incentives in Poland remain attractive, although salaries have risen in recent years.

I also see strong industry trends. The automotive industry is still very active in Silesia. Renewable energies, especially wind power and its suppliers, have developed into a fast-growing cluster in northern and western Poland. Another geopolitical trend is the increasing demand from companies in the defense industry, which I believe will continue. E-commerce also plays an important role, mainly driven by Chinese companies looking for large spaces with short delivery times. Not forgetting the regions close to Ukraine, where companies are delivering goods despite the ongoing conflict. Overall, demand is driven by a mix of supply chain optimization, cost savings and industry-specific developments, making the Polish market dynamic and diverse.

In which Eastern European countries – and in particular in which regions of Poland – do you currently see the strongest momentum in the establishment of new companies?

Poland is clearly the leader, but in almost every project we compete with Romania, Hungary and Slovakia. Romania in particular has grown strongly and often wins projects that Poland does not receive.

I see different dynamics within Poland. The south, especially Silesia, remains a hotspot for automotive and heavy industry. The Szczecin region has developed into a very strong location, mainly thanks to Scandinavian companies in the renewable energy sector. For me, it is currently one of the absolute top markets. In eastern Poland, Lublin and the surrounding area are attracting investors with links to Ukraine, both in terms of production and logistics. In general, I always emphasize to my clients that Poland offers both established centers such as Warsaw, Upper Silesia and Wroclaw as well as promising up-and-coming regions such as Szczecin, Lublin and Bydgoszcz.

2. location factors for production companies

In your opinion, what criteria are decisive for production companies when choosing a location in Poland and Eastern Europe?

In my experience, companies always evaluate several criteria at the same time. Labor costs are an important factor, but not the only one. For manufacturing companies, utilities are absolutely crucial. Without sufficient electricity, gas or water, a location is not even considered. In many cases, the availability of electricity decided whether Poland or another country was awarded the contract for a project. The approval procedures are also of crucial importance. In Poland, it takes around six months to obtain a standard environmental permit. For emissions or more complex processes, however, it can take nine to fifteen months. This is often the bottleneck. Another factor is logistics: transportation costs have risen worldwide, so proximity to suppliers and customers is becoming increasingly important. When I advise clients, I always prepare analyses that take all these factors into account. Many investors start with a preferred country, but change their mind once the analysis is complete. For me, the decisive elements are always labor, energy supply, permits and logistics – and the optimal choice results from this.

What role do real estate supply, infrastructure and energy supply play in location decisions?

Energy and infrastructure are crucial. If a location cannot provide sufficient electricity, gas or water (depending on the type of company), it is unsuitable for heavy industry. The supply of real estate plays a different role. For light industry, the adaptation of existing space is often possible, especially as around 8% of Class A space in Poland is currently vacant. For heavy industry or very specific manufacturing processes, however, existing facilities rarely meet the requirements. In such cases, build-to-suit or build-to-own projects are the solution.

This is where I see a real strength in Poland: the project developers are experienced and flexible. They are not only active in core markets such as Warsaw or Wroclaw, but also in up-and-coming regions and sometimes even develop the first modern building in a new location if a client so wishes. This offers investors choices that may not be available to them in other countries. So while infrastructure and utilities determine feasibility, Poland’s broad real estate offering ensures flexibility and adaptability, which in practice is a strong competitive advantage.

Apart from the DACH region, which countries worldwide do the investing companies mainly come from?

In addition to Germany, Austria and Switzerland, I see investors from three main groups. Firstly, companies from the USA and China that want to build up production capacities in Europe. For them, Poland is a cost-efficient and well-located entry point. Secondly, Scandinavian companies, especially in the Szczecin region, where wind energy is attracting considerable investment. This is a clear trend. Thirdly, Ukrainian companies and international companies considering Eastern Poland as a location for reconstruction in Ukraine. Although these projects have not yet been finalized, I am receiving inquiries and analyses that clearly point in this direction.

In my view, this combination demonstrates Poland’s role as a bridge: We are attractive both for global corporations optimizing their supply chains and for regional players with specific market objectives. This diversity of origins makes our market resilient and dynamic.

3. availability & costs

What is the current availability of suitable space and new construction projects for the manufacturing industry?

Availability is currently relatively high. The vacancy rate for modern class A industrial buildings is around 10% in some regions, which is unusual for Poland. Property developers continue to invest in construction as they assume that these vacancies will soon be let.

Manufacturing companies are always faced with the question of whether to adapt existing space or start a new construction project. Many customers are surprised to find that adaptation is not always cheaper – especially when there is a high supply requirement. In some cases, building a new facility is more economical than redesigning an existing one. This is why build-to-suit is still very popular. I always carry out detailed comparisons with my customers to ensure that they choose the technically and financially optimal solution. Thanks to the size of our market, we can offer flexibility: Space in established industrial centers or completely new projects in emerging regions. Overall, I rate availability as good and the competition among developers has a positive effect on investors.

How are rental and construction costs for industrial real estate in Poland developing compared to Western Europe?

Construction costs rose significantly after the outbreak of the war in Ukraine, mainly due to higher material and energy prices. However, prices have stabilized since then, giving investors planning security and keeping them below Western European levels. Rental prices also jumped in 2022, but now I see stability with attractive levels in many regions due to the current vacancy rate. Of course, rents vary greatly depending on the location. In Warsaw or Krakow, land is expensive and supply is limited, which is why prices are higher. In less saturated regions, effective rents remain at around EUR 3 per square meter (depending on size and rental period).

This flexibility makes Poland very competitive compared to Western Europe. In Germany, the Netherlands or France, investors have to pay significantly higher rents for comparable quality. Polish project developers are now also more willing to negotiate and offer flexible rental conditions and incentives.

4. financing & regulation

Which government support programs or subsidies are relevant for investors and tenants of production properties?

The most important programs are operated by the Polish Investment and Trade Agency (PAIH) and the special economic zones. They offer tax relief on corporate income tax and other incentives. Poland is characterized not only by the level of support, but also by its implementation. Each investor is assigned a fixed contact person who explains the support criteria – such as the required investment sums or job creation – and accompanies them step by step. This makes the process predictable and transparent, which many of my clients appreciate compared to less structured systems in other countries.

There are also additional programs focusing on innovation and research & development, which are important for companies with advanced manufacturing. In my view, these incentives contribute significantly to Poland’s competitiveness. They often tip the scales in our favor when competing with countries like Romania or Hungary. It’s not just about money, but also about reliability and professional support throughout the entire process.

Which regulatory framework conditions are particularly important for investors and manufacturing companies in Poland?

The two most important permits are the environmental impact assessment and the building permit. The environmental impact assessment is usually the most time-critical. For standard projects, it takes around six months, but for emissions or more complex processes, the processing time can be extended to 9-15 months. The building permit is easier to plan and should be issued within 65 days if the documentation is correct. Once completed, the occupancy permit is required before operations can commence. However, early access is often granted for the installation of equipment. Depending on the type of production, additional permits may be required, for example for water supply or complex processes. In my experience, the system is transparent, but careful planning is essential. Companies relocating their existing production need to keep a close eye on timelines, as the phased installation of machinery requires precise coordination with the approval process. My job is to support customers early on in these steps so that they avoid unexpected delays later on.

5. sustainability & future topics

What role do sustainability aspects (e.g. green factory, ESG criteria) play in new construction projects in Poland?

Sustainability is now standard. Virtually all new construction projects in Poland are now certified – usually with BREEAM at the “Very Good” or “Excellent” level. International companies are demanding this as part of their ESG strategies, but I am also observing a growing awareness among medium-sized companies.

Interestingly, property developers are no longer waiting for tenants to apply for certification. They have made it standard because they know that a building without sustainability is not competitive. In practice, this means that new construction projects are being equipped with photovoltaic roofs, charging stations for electric vehicles, LED lighting and gray water systems. Biodiversity-promoting measures such as green spaces or even beehives are common. These measures are not only good for the environment, but also reduce operating costs, for example through energy-efficient heating. Owners of older buildings are also investing in refurbishments in order to remain competitive.

6. perspective of German companies

What typical questions or concerns do German companies have when setting up a production site in Poland?

I really enjoy working with German companies because their processes are always very well prepared. They know what they want and their questions are detailed, which makes the collaboration efficient. The most common concerns relate to the availability of labor and rising wages. Although salaries in Poland have risen, they are still competitive compared to Western Europe.

Another point is the stability of the workforce. Here I always emphasize the high work ethic of Polish employees. Once they have been trained, they tend to stay with their employer for a long time, which reduces staff turnover and training costs.

German customers also analyze approval deadlines very carefully. They want predictability and we provide them with realistic timelines from the outset. Incentives are another common theme: companies want to understand the process and how PAIH and the Special Economic Zones can support them. In summary, their concerns are pragmatic and can be resolved with data, references and transparency.

What advice would you give to German manufacturing companies considering entering the Polish market?

My advice is: Firstly, consult professional advisors at an early stage. The Polish market offers many opportunities, but each production profile requires specific solutions in terms of energy supply, support programs and workforce. An early analysis helps to avoid costly delays.

Secondly, I recommend being open to the solutions offered by project developers. While ownership is common in Germany, leasing via a build-to-suit project in Poland is often faster, safer and more flexible. It shifts the risk to the project developer and ensures that the building meets modern standards.

Thirdly, I advise German companies to examine the funding opportunities in Poland. In combination with other market conditions, this can make Poland more attractive than competing countries. PAIH and the Special Economic Zones offer transparent and reliable advice in the promotion process, which many investors underestimate. Finally, I would like to emphasize that Poland combines cost advantages with a loyal and skilled workforce. For me, it is one of the best options for German medium-sized manufacturers looking to expand internationally. With the right preparation, entering the Polish market can be a very successful step.