Gross take-up in the first half of the year decreased on yearly basis in the two largest regional cities in the Czech Republic. The Regional Research Forum – comprising CBRE, Colliers International, Cushman & Wakefield, JLL, Knight Frank – published its Brno and Ostrava office market figures for H1 2017.
Brno
Total modern office stock in Brno reached 547,000 sqm in the first half of 2017. Class A properties represent 80% of the modern stock and Class B properties represent the remaining 20%. There were three office buildings completed in Brno in the first half of 2017; Šumavská Towers C (8,300 sqm), ROZMARYN office & parking (4,700 sqm) and Technologický Park II build. C (4,300 sqm). Currently, there is 40,200 sqm of office space under construction, namely Building P (15,000 sqm) in Areál Slatina, project Campus Science Park D&E (13,200 sqm) and Vlněná office park F&G (12,000 sqm). All projects are expected to be completed in 2018.
In H1 2017, gross take-up (including renegotiations) reached 25,300 sqm which represents 8% decrease when compared to previous half a year and a year-on-year decrease of 21%. The biggest transaction of the first half of 2017 was the new lease of undisclosed tenant in Areál Slatina O (4,100 sqm) followed by new leases in ROZMARYN office & parking (2 300 sqm) and Palác Magnum (1 500 aq m). All tenants of above mentioned deals are also undisclosed.
A total of 53,300 sqm of modern office space was vacant at the end of H1 2017. The vacancy rate dropped to 9.7%, representing a decrease of 2.4 percentage points compared to H2 2016.
In H1 2017, prime headline rents in the Brno office market increased to €13.5/sqm/month.
Ostrava
Modern office stock in Ostrava stood at 214,900 sqm in the first half of 2017. Class A properties represent 73% of the modern stock and Class B properties represent the remaining 27%. In H1 2017, one office building was completed; ABC Alfa (6,500 sqm). Office building Red House (4,500 sqm) is the only project under construction in Ostrava at the moment.
In H1 2017, gross take-up (including renegotiations) reached 6,400 sqm, representing a year-on-year decline by 36% and at the same an increase by 47% compared to H2 2016. The largest deal in the first half of 2017 was the expansion of ABB (900 sqm) in NOVÁ KAROLÍNA PARK, followed by the new lease of Y soft (690 sqm) which took place in the same building.
A total of 37,900 sqm of modern office space was vacant at the end of H1 2017. The vacancy rate stood at 17.6%, representing a decrease of 2.1 percentage points compared to H2 2016.
In H1 2017, prime headline rents in the Ostrava office market remained stable at €11.5/sqm/month.
