Warsaw’s office vacancy rate drops – C&W

Intense leasing activity and moderate supply defined the office property market in Warsaw last year, which led the average vacancy rate in the city to decrease to 11.7%, the lowest level since Q3 2013, according to the latest report by Cushman & Wakefield. A total of 275,400 sqm of new office space in 27 buildings was completed in the Warsaw market in 2017, 132,000 sqm less than in the record year 2016, the study said. Also in 2018 and 2019 the supply will remain at a relatively low level and some tenants (especially those looking for areas sized more than 5,000 sqm) will likely have to postpone their planned relocations and expansions till 2020 when over 430,000 sqm of new office space is expected to be delivered, said Anna Kwiatkowska, an associate, landlord representation manager, at Cushman & Wakefield. As for the demand side, almost 825,000 sqm of office space was leased in Warsaw last year, which is 9.8% more than in 2016 and only 1.7% less than in the record year 2015, according to Cushman & Wakefield data. As the availability of office space decreases, and employment and construction costs go up, one can expect slight increases in rents this year, commented Richard Aboo, a partner, head of office agency, at Cushman & Wakefield.