Companies seek low quake-risk sites to relocate factories

ISTANBUL

Turkish and international companies are looking for sites to relocate their factories from Istanbul, where experts say a big earthquake is imminent, to cities considered to be safer.

Türkiye lies on active fault lines and earthquakes are frequent. A devastating magnitude 7.8 earthquake struck parts of southern Türkiye in February last year, killing more than 50,000 people and destroying thousands of businesses.

Another factor why companies want to move their facilities from Istanbul is rising costs, according to experts.

However, as production activities are spreading to Anatolian cities, prices at organized industrial zones in those locations have started to increase.

The provinces of Eskişehir, Sakarya and the Bozüyük district of Bilecek appear to be the best choices for companies relocating their plants.

Companies that find locations in the cities believed to be less prone to quakes for their production activities are using the valuable sites where their current factories are located in metropolitan areas for different commercial investments.

Earthquake risks and higher costs are the main factors of why companies are moving away from Istanbul, said Makbule Yönel Maya, general manager of TSKB Real Estate Appraisal.

Companies are now prioritizing the risks from the expected earthquake, she said, adding that the need for relocation is expected to continue.

As demand for new locations is increasing, rents in organization industrial zones have risen on average, 120 percent annually, according to a study carried out by TSKB Real Estate Appraisal.

The highest increases were recorded in the provinces of Malatya, Konya, Antalya, Eskişehir and Sakarya and those increases were well above the annual inflation rate.

The rents of factories in those cities are spiking due to the combination of several factors such as limited supply, strong demand and inflation, according to Maya.

In the Marmara region, rents are rising fast especially in Sakarya and Kocaeli, she said.

Data related to rent hikes indicate that industrialists are moving their facilities to Anatolian cities, Maya noted. “In places like Konya and Eskişehir, rents have increased more than 130 percent in the wake of the earthquakes,” she said.

Companies which need to build new factories, firms which invest in energy systems and those who need space for their logistics operations are buying land plots, according to Arzu Turan, from Emart Gayrimenkul, a real estate company.

Businesses are booming in the real estate market in the organized industrial zones outside of Istanbul, she said.