No new completions on the Budapest office market

11
Jul
2017
News - No new completions on the Budapest office market #BRF #Budapest #Hungary #office #report

by Ákos Budai | Office

The Budapest office market vacancy rate has decreased to 8.6% in Q2 2017, which is the lowest rate ever on record.  Renewals were the major driver of the leasing activity while no new buildings were completed in the quarter. The Budapest Research Forum published its newest figures.

No new office buildings were completed in Q2 2017. The total Budapest office stock totalled 3,346,735 sqm. The total stock comprises 2,682,155 sqm of Class A and B speculative and 664,580 sqm of owner occupied buildings.

The vacancy rate has continued to decrease by 0.6 pps quarter-on-quarter to 8.6%, which is the lowest rate ever on record. The lowest vacancy rate is still recorded on the South Buda submarket (3.1%), whilst the Periphery submarket registered again the highest figure (33.1%).

Demand in Q2 2017 increased by 47% compared to the previous quarter, reaching 98,730 sqm. Renewals were the major driver of the leasing activity with 38.5% share. In the second quarter of 2017 new lease agreements were represented by 32.9%, expansions accounted to 9.9%. Pre-leases showed a higher share compared to previous periods with 18.8%. There was no owner occupation registered during the period.
 
According to BRF, 178 deals were closed in Q2 2017, with an average size of 555 sqm. In terms of submarkets, Váci Corridor had the highest leasing activity, representing more than 34% of the total demand, followed by South Buda (25%) and Central Buda (13%) submarkets.

The largest deal of the quarter was a renewal in Infopark D office building for more than 7,000 sqm. This was followed by a renewal in Átrium Park for 6,710 sqm. The largest pre-lease was signed in Office Garden III, extending to over 4,630 sqm.
 
The quarterly net absorption totalled 19,265 sqm in Q2 2017.
 
The Budapest Research Forum (BRF) comprises CBRE, Colliers International, Cushman & Wakefield, Eston International, JLL and Robertson Hungary. 

BRF Budapest Hungary office report


Latest news


New leases

  • Vastint Romania secured its first tenant for Bucharest-based Timpuri Noi Square Phase 2, signing SCOR for 3,250 sqm. The transaction, brokered by CBRE, facilitates SCOR’s expansion within Vastint’s local portfolio. The company has previously leased 2,320 sqm in Business Garden Bucharest.
  • EVO Properties has named Alexandru Marin as the new Property Manager for the London and Oslo office buildings in Bucharest. He brings over 15 years of property management experience.
  • IF&B Mille Sapori, the importer and distributor of Italian food products in Poland, has leased 4,118 sqm in the MLP Pruszków II complex. The lease deal was brokered by Coldwell Banker Commercial.

New appointments

  • Katarzyna Myjak has joined Axi Immo as Senior Business Advisory Manager, tasked with strengthening the company’s Industrial & Logistics business line.
  • Czech investment group SCF has expanded its team by appointing Jan Simandl as Senior Leasing Team Leader. In this role, Simandl will oversee leasing activities across the company’s commercial property portfolio. He previously worked for CPI Property Group and CBRE.
  • Michał Kochanowski-Laren has joined Avison Young Poland’s Technical Advisory and Project Management team as Project Manager. In his new role, he is responsible for delivering a variety of consultancy projects across all segments of the commercial real estate market in Poland. Kochanowski-Laren is an electrical engineer and a graduate of the Warsaw University of Technology.


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