Łódź office market with good prospects in Q1/2020

At the end of Q1 2020, Łódź’s total office stock stood at 528,300 sqm, up by 12.1 percent y/y. The city’s vacancy rate reached 11.4 percent, representing a 0.2 pp increase compared to  the previous quarter. It remains one of the highest in Poland, after Poznań and Wrocław.

Office absorption was in the negative territory in Q1 2020 (minus 770 sqm), which was due to the lack of new office supply in Q1 2020, although this number is within the margin of error. The absorption rate is expected to turn positive in the coming quarters, confirming the growth trend of the Łódź office market.

No new office building was added to the market in the first quarter of 2020. Łódź’s office stock is, however, expected to expand by more than 44,000 sqm in the next three quarters, with such projects as MMG’s Hi Piotrkowska 155 and Skanska’s Brama Miasta B.

“Łódź’s office market continues to grow at a steady pace. The large share of new leases in the total leasing volume is confirmation of the robust occupier interest in Łódź. This trend is expected to continue with a new wave of BPO/SSC companies opening up in Poland. The excellent geographical location, convenient access to Warsaw and a business friendly environment are just some advantages of the city that make it attractive to companies from this sector. More developments are being planned for post-industrial sites in Łódź. These include Fuzja, Echo Investment’s mixed-use project that will see an old power station revitalized. Its two first office buildings which will be delivered in 2022 will be occupied by Fujitsu,” Martyna Balcer, Senior Advisor, Transaction Coordinator at CRESA, commented.

(WBJ)