CONTACT US
Share: Share on Facebook Share on Twitter Share on LinkedIn I recommend visiting cushmanwakefield.com to read:%0A%0A {0} %0A%0A {1}

Czech Republic is among key nearshoring destinations

21/06/2023

74% of European companies plan to move their production to Europe1
• The CEE region, Spain and Portugal, and Turkey and Morocco will benefit from the trend
• The Czech Republic holds importance among the 16 countries most suitable for nearshoring

 

After a period when it was advantageous for companies to have production capacities outside Europe for many reasons, the time of nearshoring, i.e. moving production closer to customers, is coming. According to Nearshoring, the latest report by Cushman & Wakefield, a leading global commercial real estate services firm, the CEE region is one of its ideal destinations: it has relatively cheap labour within Europe, opportune geographical location and good transport infrastructure. This will allow manufacturers to save costs, including those for transport, reduce delivery times and increase flexibility in ordering. In doing so, they will avoid the risks associated with supply chain disruptions that we have seen recently, rising shipping costs and negative perceptions related with ESG.


The main target within CEE will be countries that have the advantages of EU membership and are close to Western markets - especially Germany and Austria. The Czech Republic is the only country bordering both and fulfilling the other conditions - making it a hot candidate for locating production capacities.

Jiří Kristek, Partner, Head of the Industrial and Retail Warehousing Team, Cushman & Wakefield: "Several such relocations have already taken place - Jungheinrich, for example, has located its production plant in the Czech Republic in recent months. We are already aware of more manufacturers considering the Czech Republic or the Central European region as one of their preferred destinations, so we will definitely see more of these activities that will boost the local economy and employment. In general, these are value-added demands, i.e. both production capacities and development centres, which can offer interesting opportunities for their suppliers, which may be local companies."

Automotive parts and clothing manufacturers are interested

The Czech Republic’s additional advantage is its continued construction of new industrial capacity: at the end of this year's first quarter, over one and a quarter million square metres of such space was under construction, which is 5 per cent more than in the previous quarter and 9 per cent more than in the same period last year. Almost a quarter of the volume is in the Karlovy Vary region, followed by the Pilsen region and the South Moravian region2. This corresponds with the aforementioned emphasis on proximity to the German and Austrian markets.

The Czech Republic has traditionally produced parts and components for car manufacturers in those countries - and this trend could grow further with nearshoring. The production of machinery, electrical equipment and electronics could also be directed here. However, manufacturers of clothing and other consumer goods are also showing interest in CEE, including the Czech Republic. The reasons include proximity to the end customer and the lower social and environmental impact of production, which is an increasingly important part of the decision-making process for buyers.

Jiří Kristek, Partner, Head of the Industrial and Retail Warehousing Team, Cushman & Wakefield: "The Czech Republic is also attractive for companies considering relocating production due to its geopolitical stability, skilled workforce and investment incentives, which are however still not at level with those in neighboring countries. This is where I see room for improvement of our position in Central European competition."

Manufacturers’ demand will grow – namely for new built-to-suit halls

Modern manufacturing projects tend to have very specific requirements in terms of size, layout or equipment, unlike, for instance, those for warehousing. That is why brand new halls that are built directly to the specific needs of the manufacturing company are the most suitable for their placement.

For the real estate sector, this trend means an expected increase in demand for industrial space from manufacturers. In the Czech Republic, their share in the total volume of tenants has been roughly between 30 and 40 percent in recent years, and is now likely to grow. Within CEE, Poland, the region's largest industrial market, is the Czech Republic's main competitor. Outside of CEE, considerations of shifting production are turning to southern European countries with cheaper labour, especially Spain and Portugal, and geographically close Turkey and Morocco.


Map: Key emerging nearshoring opportunity areas

Nearshoring map

Source: Cushman & Wakefield

1 Source: ABB
2 Source: Industrial Research Forum

 

A summary report is available for download from Cushman & Wakefield’s website.

Related News

Czech Republic MarketBeats Teaser Image.jpg
Investment in Commercial Real Estate in the CEE Region Attracts Record Capital Inflows; Czech Republic Strengthens Its Position as a Regional Leader

The commercial real estate (CRE) market in Central and Eastern Europe (CEE) continues its dynamic growth.

23/09/2025

Prague_Castle night.jpg
Czech Hotels Attract Record Investment in First Half of 2025

The Czech hotel market continues to demonstrate resilience and growing investor interest, with Prague remaining a key destination for hospitality investment across Central and Eastern Europe.

Martina Pavlíková • 23/09/2025

city, building
Commercial Real Estate Investment in the Czech Republic Breaks Records – EUR 2.1 Billion in H1

The commercial real estate investment market in the Czech Republic is experiencing an exceptionally strong period.

Martina Pavlíková • 18/07/2025

123
In the first half of the year, 16 new brands entered the Czech Republic

Sixteen brands entered the Czech retail market in the first six months of this year. The most common segments were fashion (clothing, footwear, and accessories – 6 brands) and gastronomy (F&B – 5 brands). Fourteen of the new entries opened in Prague, with one in České Budějovice and one in Třebíč.

26/06/2025

AdobeStock_982998512_750x456.jpg
In 2024, demand for industrial halls dropped by a third. What will 2025 bring?

After a record-breaking year in 2023, when nearly 2.96 million sq m of industrial space was in demand1, the industrial market experienced a significant slowdown in 2024.

Martina Pavlíková • 19/06/2025

Czech Mall.jpg

Related Insights

city, cover
Insights

CEE Investment Market Update H1 2025

CEE investment Market Outlook 2025 analyse commercial real estate in Czech Republic, Hungary, Slovakia, Poland, Romania and Bulgaria.
Marie Baláčová • 05/09/2025
Uvodka_CWInsightsOutlook_H2_2025_750x456.png
Video • Economy

What you need to know about commercial real estate market | Outlook H2 2025

Explore our real estate market snapshot, a video overview of the commercial real estate market developments presenting the key trends in real estate investment, logistics, office, retail and hospitality sectors.
Marie Baláčová • 01/09/2025
Czech Republic MarketBeats Teaser Image.jpg
MarketBeat

Czech Republic MarketBeats

MarketBeat reports analyse quarterly Czech Republic commercial property activity across office, retail, industrial and hotel real estate sectors including supply, demand and pricing trends at the market and submarket levels.
Kamila Breen • 28/07/2025
coworking
Research

Coworking and Serviced Offices

Explore the dynamics of the flexible offices in the Czech Republic.
Kamila Breen • 16/04/2025
Fit Out Cost Guide
Research • Workplace

EMEA Office Fit Out Cost Guide - Czech Republic

Discover the essential data for planning and budgeting your office transformation in the Czech Republic with our Office Fit Out Cost Guide 2025. Begin optimizing your workspace in key cities like Prague today!
24/03/2025
25009_ European Luxury Retail report 2025_Web Card (SMALL) 750x456px.png
Research

European Luxury Retail

Explore the dynamics of the European luxury retail real estate market.
Sally Bruer • 10/03/2025
office, statistics, laptop
MarketBeat

CEE MarketBeats

Cushman & Wakefield MarketBeat reports analyse quarterly commercial real estate activity in the CEE region (Czech Republic, Hungary, Poland, Romania, and Slovakia) across office, retail, industrial and hospitality real estate sectors.
Marie Baláčová • 17/02/2025
European Retail Logistics
Research

Revolution in Retail Logistics

The retail sector is adapting to new challenges and optimizing logistics for more efficient operations.
28/11/2024
Prague, Czech Republic
Research • Economy

Czech Real Estate Market View

A regular update on the commercial real estate market in Czech Republic.
Marie Baláčová • 27/04/2023

CAN'T FIND WHAT YOU'RE LOOKING FOR?

Get in touch with one of our professionals.
With your permission we and our partners would like to use cookies in order to access and record information and process personal data, such as unique identifiers and standard information sent by a device to ensure our website performs as expected, to develop and improve our products, and for advertising and insight purposes.

Alternatively click on More Options and select your preferences before providing or refusing consent. Some processing of your personal data may not require your consent, but you have a right to object to such processing.

You can change your preferences at any time by returning to this site or clicking on Cookies
MORE OPTIONS
Agree and Close
These cookies ensure that our website performs as expected,for example website traffic load is balanced across our servers to prevent our website from crashing during particularly high usage.
These cookies allow our website to remember choices you make (such as your user name, language or the region you are in) and provide enhanced features. These cookies do not gather any information about you that could be used for advertising or remember where you have been on the internet.
These cookies allow us to work with our marketing partners to understand which ads or links you have clicked on before arriving on our website or to help us make our advertising more relevant to you.
Agree All
Reject All
Save settings