Tenant activity in the Warsaw office market in the first three quarters of 2020 was 35 percent lower than a year ago. In total, 113,000 sqm of office space were leased. The developers, however, did not slow down – according to the latest CBRE report. New supply and economic factors related to the coronavirus epidemic have driven the vacancy rate up. At the end of the third quarter of this year, there were 9.6 percent of empty offices in Warsaw, which is the highest result in two years.
"As predicted, we have noticed the impact of the coronavirus epidemic on the Warsaw office market. Companies have suspended lease decisions, as evidenced by, inter alia, the lack of transactions over 10,000 sqm. Nevertheless, we cannot speak of a market slump. 113,000 sqm of space were leased in the third quarter, only 26,000 sqm less than in Q1. Additionally, the third quarter falls on the holiday period, when companies usually postpone decisions related to renting until later,” Mikołaj Sznajder, director of the office space department at CBRE, said.
In the third quarter of 2020, 131,500 sqm of space were delivered to the Warsaw office market. Seven projects are responsible for this result, but as much as 67 percent of this space is occupied by two buildings of The Warsaw HUB complex. Currently, the capital of Poland offers a total of 5.82 million sqm of office space. Importantly, market conditions did not change the decisions regarding the commencement of the investment – Skanska Property Poland has started the construction of the P180 project in Mokotów, with the size of 32,000 sqm, while Dor Group has started the construction of DOR Plaza in the corridor of ul. Żwirki i Wigury (14,600 sqm).