Hungary Logistics Facilities
Economic recovery in Hungary is expected to add cyclical demand to the second half of 2021 in eCommerce, driving demand for logistics facilities.
Demand for logistics facilities in Hungary has surpassed expectations. Logistics market have been rising the past few years and are expected to grow at an annual rate of 6% in years 2021-2025. Facility vacancies remained close to record lows in various sectors and the willingness to spend on expanding logistics networks has also increased.
Due to its geographical position, Hungary occupies a central position in Europe, acting as a ferry linking the EU with the rest of Europe. U.S. companies present and wishing to establish a presence in Hungary can take advantage of this by establishing their logistic center in Hungary and supply Europe from here. This has become important as demand drivers include accelerated e-commerce, reassessment of inventory levels, and the requirement for speed to market products.
The incremental cost of logistics real estate remains a small portion of total supply chain costs, with rents representing approximately 5%. Structural trends are expected to drive demand for prime logistics real estate. The future of supply chains is faster and more resilient.
Further investment in logistics facilities is geared toward the creation of specialize logistic facilities to handle sensitive cargo as U.S. companies are interested in warehousing and receive full-line logistic support for time and/or temperature sensitive goods.
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