Demand for office space in Poland is growing. For the first three quarters of 2012, in Warsaw, 455 000 sq m of offices has been leased. CBRE forecasts shows that the overall leased space will be higher this year than the previous record of 2011 which amounted to 573 000 sq m.
Record demand for office in 2012?
CBRE summarizes year of 2012 on the commercial real estate market - the demand for office is growing, and developers are building more and more.
Joanna Mroczek, Director of Market Research and Advisory Services at CBRE says - In many Polish cities like Krakow, Wroclaw and Tri-City, the amount of space leased in the first three quarters of 2012 exceeded the results achieved in the whole of 2011. This is primarily due to the development of the modern services sector of BPO business, with more than 100 thousand people working in this sector in Poland and the largest BPO centers in Poland are Warsaw, Krakow, Wroclaw and Lodz. It is the development of the BPO sector that is responsible of the growing demand for office space.
Supply responds to demand. In recent years, many new investments were started, which made us to believe that in the next few years the vacancy rate will increase. Throughout the country, the supply of office space in this year will be at about 600 000 sq m. In the capital 700 000 sq m is under construction, and in 8 biggest, regional cities - 510 000 sq m in total. Lodz, Gdansk and Wroclaw are the places where one can lease an office in an easy way, taking into account vacancy rates and buildings that are under construction.
Warsaw office market has come a long way. The first office buildings were built in the 90s and now are often retrofitted or even demolished. The zones of office surface are changing, which is shown for example by the moving of the Centrum zone to the west and by the blurring of boundaries between Mokotów and Okęcie. In the future, we can expect an increase in demand for office space in the district of Bielany and Praga.
Rents in the capital are stable. In the city center they are at the level of 26-27 EUR / sq m per month, outside the city center they are at the level of 14-15 EUR / sq m. Due to the strong competition, however, the developers decide on incentives for tenants, such as the period of exemption from rent.