The modern office stock in regional Romanian cities is set to reach around 1.3 million sqm in the next five years if the planned projects spanning 275,000 sqm will be delivered in this period, according to a report by real estate consultancy Cushman & Wakefield Echinox.
At the end of 2022, Cluj-Napoca remained the largest regional office hub, with a stock of 340,000 sqm, followed by Timișoara - 293,000 sqm, Iași - 213,000 sqm and Brașov - 152,000 sqm.
Iași and Cluj-Napoca will benefit from the highest new supply of office spaces in the coming years: 164,000 and 75,000 sqm respectively, while projects with total leasable areas of 16,000 and 21,000 sqm are expected in Timișoara and Brașov.
“The major regional cities continue to be a point of attraction for the companies wishing to further expand their presence in Romania, with developers therefore aligning their investment plans based on this continuous demand, as new office spaces which could accommodate more than 25,000 employees are due to be built in the analyzed cities by 2028. We consider that the main challenge present in the four cities pertains to the workforce availability, considering the very low unemployment rates,” said Vlad Săftoiu, Head of Research at Cushman & Wakefield Echinox.
The biggest office investments under development include Prime Kapital’s Silk District in Iași that will have offices spanning 104,000 sqm and Iulius’ Palas Campus with a leasable area of 60,000 sqm that will be delivered in the first half of this year. Meanwhile, AFI Europe intends to extend AFI Park and NHood announced a new building within the Coresi Business Campus. The most important projects expected in Cluj-Napoca relate to Prime Kapital’s and Iulius Group’s mixed-use projects with office components that will be developed on former industrial sites.
Cluj-Napoca and Brașov have the lowest vacancy rates (6% and 7% respectively), while 10% of the Timișoara office stock is unoccupied. Moreover, a higher vacancy rate of 18% is recorded in Iași, mostly in B-class buildings.
The prime headline monthly rents have seen a marginal increase, ranging between €11 – 13.5 per sqm in Brasov, while also reaching a level of €15-16 euros per sqm in Cluj-Napoca and Iași.
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