C&W H&B report drop in supply of office space in Warsaw
Total new supply of office stock declined by about 8 percent year-on-year in the capital by the end of 2003 and the downward trend is set to continue this year as well.
Office stock in Warsaw amounted to 2,249,000 square meters at the beginning of July 2004 and only 41 percent of this was located in the Central Business District (CBD). This total amount will be augmented in 2004 but most of it will arrive in non-central locations (NCL). "New delivery in the CBD will be limited until 2005 when two large projects are planned for completion," explains the report.
Demand for office space in the city has, however, continued to grow and total gross take-up (deals signed) in Warsaw amounted to just over 280,000 square meters in 2003, which is an 8 percent year-on-year increase. This was partially attributable to economic recovery and more attractive lease terms. Demand nevertheless remained concentrated on non-central locations, with NCL representing a 61 percent share of total space in Warsaw in 2003.
The average vacancy rate in Warsaw has been falling steadily over the last two years to around 12.5 percent at the end of the second quarter of this year. This was supported by both the lower level of speculative completions and the improving absorption ,but again there was a discrepancy between the CBD and NCLs. In the former, the vacancy rate moved up to 18.6 percent at the end of the second quarter of 2004, while the rate in non-central locations was 8.3 percent by the end of the same period.
Rents have adjusted across the city, particularly in the CBD because of the increasing vacancy rates and the competition from areas beyond it. Prime rents here were recorded as E24 per square meter, whereas the non-central districts could offer as little as E16 per square meter.
Office stock in Warsaw amounted to 2,249,000 square meters at the beginning of July 2004 and only 41 percent of this was located in the Central Business District (CBD). This total amount will be augmented in 2004 but most of it will arrive in non-central locations (NCL). "New delivery in the CBD will be limited until 2005 when two large projects are planned for completion," explains the report.
Demand for office space in the city has, however, continued to grow and total gross take-up (deals signed) in Warsaw amounted to just over 280,000 square meters in 2003, which is an 8 percent year-on-year increase. This was partially attributable to economic recovery and more attractive lease terms. Demand nevertheless remained concentrated on non-central locations, with NCL representing a 61 percent share of total space in Warsaw in 2003.
The average vacancy rate in Warsaw has been falling steadily over the last two years to around 12.5 percent at the end of the second quarter of this year. This was supported by both the lower level of speculative completions and the improving absorption ,but again there was a discrepancy between the CBD and NCLs. In the former, the vacancy rate moved up to 18.6 percent at the end of the second quarter of 2004, while the rate in non-central locations was 8.3 percent by the end of the same period.
Rents have adjusted across the city, particularly in the CBD because of the increasing vacancy rates and the competition from areas beyond it. Prime rents here were recorded as E24 per square meter, whereas the non-central districts could offer as little as E16 per square meter.
