The accelerated growth of work from home arrangements has generated a new market for office space that can be leased directly by companies that have ongoing rent contracts for bigger surfaces. At present, around 70,000 sqm is available for sublease, which is a record figure for the Romanian market, according to representatives of JLL.
The volume of offices available for sublease is still small compared to the total office stock in Bucharest, which reached around 2.95 million sqm at the end of 2020.
“Inevitably, these spaces, many of them properly arranged for class A offices, including furnished ones, put a lot of pressure on the owners who still have unoccupied spaces in their portfolio. Not only the rent level is the problem, but also the flexibility of the contractual terms offered by these spaces, many companies, especially those that open new offices in the country, but also those based on temporary projects finding these spaces ideal, in competition with co-working spaces," says Marius Șcuta, Head of Office Department & Tenant Representation at JLL Romania.
This year, demand in the office segment will come mainly from tenants whose contracts expire during this period, and who have seized the opportunity to secure advantageous contracts for the coming years.
The move to a hybrid model, which combines office and remote work, will impact the design of residential projects, while some office developers might consider adding a housing component and other facilities to their projects.
On the Bucharest market, demand for offices hit an 8-year low in 2020. The volume of demand stood at 214,000 sqm, down 40% compared to 2019, according to a report by real estate consultancy Colliers. In regional cities, demand fell only 19%.
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