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11:41
WAREHOUSE MARKET IN KYIV REGION 12% UP IN H1, 2009, RENT RATES 30% DOWN, SAYS SURVEY

Kyiv, August 4 (Interfax-Ukraine) – In January to June 2009 three professional warehouses of 81,400 square meters were commissioned in Kyiv city and Kyiv region, so the rise in warehouse space was 12%, and by early July, the A and B class warehouse area reached 776,700 square meters, according to a Kyiv commercial real estate market survey drawn up by Knight Frank LLC Ukraine.

"The commissioning of new premises has slowed. No more than 103,200 square meters out of the 208,700 square meters planned for commissioning in Q3 and Q4 will actually be commissioned," the company said.

Knight Frank LLC Ukraine's specialists said that the share of A class warehouses is growing thanks to the commissioning of new complexes. In particular, by early July 2009, the share of A class warehouses was 35% against 18% in July 2008.

"The share of B class warehouses is 14%, while C and D warehouses are still leaders on the market thanks to [the availability of] large industrial territories and the re-equipped warehouses in cities and towns. Their share is 51%," reads the survey.

The company said that in H1, 2009 rent rates for warehouses in Kyiv city and Kyiv region fell by 30% on average, to $5.5-8.5 per square meter per month for one-year contracts. The contracts were signed mainly for payments in hryvnias, and the market is gradually switching from pricing rent rates in dollars.

"In H1, 2009 it expected that some deals for the leasing of vacant space will be signed, [talks on] which were started in spring 2009. This would slightly stabilize the market... Nevertheless, the rent rates will continue falling. One could expect an 8-12% fall by the end of the year," the company said.

The survey says that demand for warehouses in H1, 2009 has halved, and continues falling.

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