According to report prepared by an international JLL consulting company which summarizes the Polish office market at the end of the first quarter in 2015, the developers commissioned ca. 149 500 sq. m of new office area, including ca. 59 000 sq. m in the capital city and 90 500 sq. m in regional centers from the beginning of the year.
The list of the biggest projects completed in Warsaw includes such investments as Dzielna 60 (20 000 sq. m), Nestlé House (17 600 sq. m) and Karolkowa Business Park (15 000 sq. m). In case of regional cities, the greatest amount of new areas was commissioned in the capital city of Greater Poland. However, it is worth mentioning that the totality of the area (42 000 sq. m) is composed of one investment – the Business Garden Poznań complex owned by the Vastint company. The big office projects were also commissioned in Cracow (Bonarka for Business E – 10 000 sq. m) and Katowice (the second stage of A4 Business Park – 9000 sq. m).
At present, there are ca. 1,4 million modern office area in realization, the half of which is located in Warsaw. It is worth pointing out that another 56 000 sq. m are being thoroughly renovated in the capital. Moreover, almost 360 000 sq. m in Poland may be commissioned this year (considering area realized in one sq. m). According to initial plans for the year 2015, a part of the investment may be moved for the beginning of 2016.
The first quarter of 2015 was continuation of a good economic situation on the Warsaw office market from the second half of 2014. The gross demand exceeded 168 000 sq. m in this city which means that it was higher by ca. 30 per cent in comparison to analogical period last year. The most sq. m – that is over 61 600 (ca. 37 per cent of demand) were rented in the area of Mokotów. The greatest transactions concluded in the first quarter of 2015 are i.a. a new contract of PZU in Konstruktorska Business Center (17 500 sq. m), extension of a lease agreement by HP (10 400 sq. m in University Business Center II) and extension as well as expansion of P4 (10 200 sq. m in Marynarska Business Park). The experts of JLL forecast that the demand for offices will also maintain on a similar level in the other quarters of 2015.
The demand outside the capital reached 132 000 sq. m. In Cracow, the tenants signed contracts for 32 400 sq. m of office space, in Katowice – on 27 800 sq. m, whereas in Wrocław – on 23 400 sq. m. The greatest transactions were i.a. contracts concluded in the Upper Silesia – PKP CARGO rented 7600 sq. m in A4 Business Park II and Capgemini signed a pre-lease for 5600 sq. m in Silesia Business Park B. We had a very good beginning of year in the segment of office areas in Poland. Warsaw with regional cities registered a high demand which confirms that the lease market is still in a good condition – comments Anna Młyniec, Chairman in Department for Lease of Office Area and Tenant Representation, JLL.
According to estimates of JLL, ca. 29 per cent of office area which were planned for realization in the period from the second to the fourth quarter of 2015 have been already secured with lease contracts.
The rate of unrented area in Warsaw recorded a slight fall to the level of ca. 13 per cent quarter to quarter. According to JLL, the vacancy rate will start increasing again due to entering of new projects on the market which were envisaged for realization in the period from the second to the fourth quarter of 2015 and 2016. The rate remained stable on the regional markets (except for Poznań) or it recorded a slight fall. Moreover, Cracow is characterized by the lowest rate (6,2 per cent) and the capital of Greater Poland – by the highest one (23,3 per cent).
The rents in Warsaw are stable, however, in the face of a considerable new supply they may be under discount pressure in 2015. It will concern especially older and lower quality structures. The highest transaction rents oscillate between 22 and 24 euro for one sq. m per month in the city center and 11-18,5 euro for one sq. m per month in other locations. The highest transaction rents in regional cities amount to respectively 11-12 euro for one sq. m per month in Lublin and 14-15 euro for one sq. m per month in Poznań.
The first quarter of 2015 enhanced the position of regional cities on the Polish office market. The small volume of commissioned area enabled stabilization of the vacancy rate on those markets, except for Poznań. However, the high developer activity will lead to a considerable increase in supply in the next quarters which will cause a rise in unrented areas on certain markets – sums up Mateusz Polskowski, Chairman in Market Research and Consultancy Department, JLL.