The office market in Bucharest continues to grow, with 124,000 of modern office space delivered in the first nine months of the year 388,000 sqm more in the pipeline, according to Cushman & Wakefield Echinox. The commercial stock of office buildings in Bucharest reaches about 2.9 million square meters with an additional 150,000 sqm of owner-occupied stock.
The number of state-owned companies relying on modern office space is on the rise, reveals Savills. The public sector and state-owned firms more than doubled their share in office take-up in Warsaw in Q1-Q3 2020 compared to last year. What’s more, Savills estimates that negotiations are pending for more than the amount of office space leased by this sector in the nine months to September 2020.
In previous quarters the analysts of the EBI Construction Activity Report broadly discussed the negative effects of the pandemic on Hungary’s construction industry. The latest figures also suggest that there is still no improvement in the sector after a weak first half of the year.
238,300 sqm of office space was delivered to the Warsaw office market in the first three quarters of 2020, reveals Cushman & Wakefield. Due to the worsening sentiment of market participants, prime headline rents edged down by €0.25/sqm/month, standing at €23.75/sqm/month in the centre and at €14.75/sqm/month in non-central locations.
During Q3 2020, gross take-up on the Czech industrial market reached 289,400 sqm which is a decrease of 21% year-on-year. Still, the vacancy rate decreased over the quarter. The Industrial Research Forum announced the industrial market figures for Q3 2020.
Poland’s commercial property investment volume surpassed €4 billion in the January-September period of 2020, down by 12.4% on the same period in 2019. Logistics accounted for nearly half of the investment activity while offices made up 38% of the transaction volume in Q1-Q3 2020, according to Cushman & Wakefield.
CEE Investment volumes for the Q1-Q3 2020 period have reached ca. €8.0 billion and are 12% down compared to the same period of 2019. Poland attracted €4 billion which represents 50% of all volumes in this period. Average transaction sizes are up 31.5% and the number of transactions is down 32% according to Colliers International. Despite investor appetite remaining strong for CEE, year-end volumes are likely to reach €10-11 billion, ca. 20% lower than in 2019.
The industrial/logistics asset class is presently the most attractive for a majority of banks in Central & Eastern Europe (CEE) following the breakout of the COVID-19 pandemic, according to results from the latest edition of KPMG’s Property Lending Barometer (PLB), an annual study by the global audit and advisory firm that attempts to measure banks’ lending sentiments in Europe’s property markets. That preference lies in contrast to where most bank finance in Europe has typically landed prior to COVID: the office segment.
Half of the employees who normally work in office buildings continued to work mainly from home even after the state of emergency was lifted, despite the fact that, during the summer, most companies began to bring back their employees partially or through rotation in the office spaces, as shown by a research study conducted by Cushman & Wakefield Echinox regarding the working methods of employees in Romania during the COVID-19 pandemic.
Partially due to the pandemic, demand for office space on Poland’s largest regional markets from January to September was 11% lower year-on-year. Many tenants are temporarily postponing expansion plans and relocation decisions, according to JLL’s summary.
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