Economy: Industrial Output Weakens, Inflation Below 4%
Industrial production declined by 2.0% YoY in May and by 1.3% over the first five months, mainly due to weaker output in transport equipment, basic metals and refined petroleum products. However, part of the decline reflects last year's strong production base, meaning the figures do not necessarily point to a significant weakening of industrial activity.
Inflation reached 3.5% in June and has stabilized slightly below 4%, while unemployment remained low at 4.0%. Despite elevated inflation and fiscal consolidation, household consumption supported GDP growth of 0.9% in Q1. Economic activity is expected to accelerate to 1.9% in 2027, driven mainly by recovering global trade and stronger foreign demand.
Supply & Demand: Lower Take-Up, Strong Pre-Leasing Activity
Leasing activity remained subdued in Q2 2026, with gross take-up reaching 93,400 sq m across 18 transactions, representing a 28% QoQ decline following a stronger start to the year. Net take-up reached 66,600 sqm, meaning 17% QoQ increase. Demand was driven primarily by pre-leases, which accounted for 50% of total take-up, highlighting occupiers' continued preference for securing high-standard space with certification. Leasing activity remained concentrated in the Košice and Bratislava regions, particularly in Senec submarket.
Development activity remained limited, with 25,800 sq m of new space completed spanned across two buildings, bringing Slovakia's modern industrial stock to 4.89 million sq m. Meanwhile, the construction pipeline expanded to 265,800 sq m, with 37% already pre-leased, reflecting occupier interest despite a more cautious market environment.
Vacancy increased slightly to 7.8%, the highest in the last five years, mainly due to weaker leasing activity. However, continued pre-leasing suggests occupier interest remains resilient.
Pricing: Stable Rents Despite Higher Vacancy
Occupier conditions remained broadly balanced during the quarter despite a large amount of available space. Therefore, rental levels remained stable, with prime industrial rent holding at €5.30/sq m/month. Demand continued to focus on modern logistics and manufacturing facilities in established industrial hubs, supporting rental stability across most regions despite growing availability.
