Once a year, the entire team of 108 gets together in one place. This year it took us to the Beskydy Mountains - specifically Ondráš's yard - and we had a blast from Wednesday to Friday.
Investment in industrial real estate in Europe fell by 21% year-on-year in Q1. The blame lies with the uncertain and less predictable global economic situation, or the impact of geopolitical instability in the Middle East, affecting in particular the performance of the logistics market. The total volume of EUR 7.5 billion for which warehouses and production halls on the European continent changed hands in the first quarter of this year is below the long-term quarterly average. However, data from real estate consultancy 108 REAL ESTATE, shared with BNP Paribas Real Estate as part of an alliance, shows that compared to traditional investment dominants such as France, the Netherlands, Germany and the UK, investor activity grew in Central European countries.
Around 230,000 m² of modern warehouse and production space was newly occupied in the Czech Republic from January to the end of March. Gross demand including renegotiations amounted to 422 thousand m². The main accelerator was the automotive industry, which reported the strongest production volume in the history of the Czech Republic in the period under review. And it is the automotive industry that is driving growth in other sectors, including logistics.
Investment in industrial and logistics real estate in Europe fell by 21% year-over-year in the first quarter of 2026, with the decline extending across markets—France -52%, the Netherlands -43%, Spain -39%, the United Kingdom -29%, Germany -11%. The only major market that bucked the trend significantly was Poland, with growth of 121%.
Demand for logistics and industrial space in major European markets fell slightly by 4% in the first quarter of 2026, with significant differences between countries—it strengthened in the United Kingdom, Spain, and Germany, while it declined in France and the Netherlands. Meanwhile, prime rents rose by 2.7% year-over-year across 45 markets in 21 countries.
Office leasing volume in 18 major European markets totaled 1.67 million m² in the first quarter of 2026, down 16% year-over-year and by the same percentage below the five-year average. The main reason is a slowdown in large transactions; amid economic uncertainty, tenants are opting for smaller, high-quality spaces.
The volume of commercial real estate investments in Europe reached 36.4 billion euros in the first quarter of 2026, down 7% year-over-year and 16% below the five-year average. The slow recovery of the past two years lost momentum in the first quarter.
The optimistic mood prevails after the recent elections and the change of political situation in the industrial real estate market in Hungary. While the Czech Republic is often compared to Poland, Hungary is building its own position thanks to the automotive industry. According to real estate consultancy 108 REAL ESTATE, which has a presence in Budapest, the supply of modern warehouses and manufacturing space is expected to continue to grow, stimulated by the expected rising demand. The main reason for this is the multiplier effect of the major automotive brands already present on the Hungarian market. The vision of economic growth, expressed among other things by the new government's desire to adopt the euro as soon as possible, is also playing a role.
Domestic industrial hall leases in the Czech Republic have a number of specificities in the Central European context. But one parameter stands out above the rest: over the last three years, the logistics segment has outnumbered manufacturing in concluded lease transactions. And by a large margin. According to real estate consultancy 108 REAL ESTATE, over 550,000 sqm of industrial space was leased to manufacturing or processing companies in the whole of 2025. This was a 42% share of the total volume of transactions. Logistics-related tenants accounted for 33.85% of the total, while the remaining 24% belonged to retail, services and others. In total, approximately 1.3 million sqm of new industrial properties were occupied by new tenants in 2025.
