04. Juni 2010 
Print
Print
DTZ: Office take-up in Q1 2010 incresed 65% year-on-year
In the first quarter of the year ca. 68,000 sq m of new stock was delivered to the market. This reflected 24% of the projected annual supply for 2010. Thus, the modern office stock reached circa 1.59 mil sq m at the end of March 2010.
Office developments delivered in Q1 2010 are mostly located in the centre and centre-north areas and include: City Gate (tower B/21,000 sq m), Euro Tower (16,500 sq m) and Platinum Center (8,780 sq m). As a consequence of this, the north area maintains the highest share of the total office stock (49.1%), followed by Centre (15%) and Centre-North (14.8%).
For 2010, the new supply is estimated to reach ca 288,000 sq m by year end, recording a 12.7% decrease year-on-year. The pipeline supply for the remainder of 2010 is ca 220,000 sq m. The limited access to finance and increased availability of office space will result in a lower anticipated level of supply for 2011, at present expected to be around 135,000 sq m (53% decrease year-on-year).
Demand
Q4 2009 was the highest quarter for take-up last year with 60,000 sq m. Take-up for Q1 2010 was lower but supported a general feeling of the strengthen of the market. Take-up in Q1 2010 compared to Q4 2009 reflected a 30% decrease quarter-on-quarter and a 65% increase year-on-year (versus Q1 2009).
Relocations represented 85% of the total take-up.
The largest transaction was a 11,735 sq m letting by Sanador within Sevastopol Office Building. Space requirements for the centre ranged between 200-1,200 sq m whilst in decentralised locations they varied between 400-1,000 sq m.
DTZ forecasts that total take-up for 2010 could reach 190,000 sq m, 46% increase compared to previous year.
Vacancy
The vacancy rate continued to increase in Q1 2010 to 18.1%.
The north area registered the highest level of vacancy, whilst the central area currently reports the lowest.
By contrast, with a decrease in the new supply in addition to the new demand, we expect a balance of the market to return and further vacancy rate to decrease until the end of 2010.
Rents
Prime headline rents during Q1 2010, reduced by 5% quarter-on-quarter.
Prime rental levels are €19-20 per sq m per month for buildings located in the centre area, €14-17 per sq m per month for semi central locations whilst rents for decentralised areas were in range of €9-13 per sq m per month.
According to our estimations, we expect to see further rental decline in the short term with rents expected to hit the bottom of the cycle in the second half of 2010.
Office developments delivered in Q1 2010 are mostly located in the centre and centre-north areas and include: City Gate (tower B/21,000 sq m), Euro Tower (16,500 sq m) and Platinum Center (8,780 sq m). As a consequence of this, the north area maintains the highest share of the total office stock (49.1%), followed by Centre (15%) and Centre-North (14.8%).
For 2010, the new supply is estimated to reach ca 288,000 sq m by year end, recording a 12.7% decrease year-on-year. The pipeline supply for the remainder of 2010 is ca 220,000 sq m. The limited access to finance and increased availability of office space will result in a lower anticipated level of supply for 2011, at present expected to be around 135,000 sq m (53% decrease year-on-year).
Demand
Q4 2009 was the highest quarter for take-up last year with 60,000 sq m. Take-up for Q1 2010 was lower but supported a general feeling of the strengthen of the market. Take-up in Q1 2010 compared to Q4 2009 reflected a 30% decrease quarter-on-quarter and a 65% increase year-on-year (versus Q1 2009).
Relocations represented 85% of the total take-up.
The largest transaction was a 11,735 sq m letting by Sanador within Sevastopol Office Building. Space requirements for the centre ranged between 200-1,200 sq m whilst in decentralised locations they varied between 400-1,000 sq m.
DTZ forecasts that total take-up for 2010 could reach 190,000 sq m, 46% increase compared to previous year.
Vacancy
The vacancy rate continued to increase in Q1 2010 to 18.1%.
The north area registered the highest level of vacancy, whilst the central area currently reports the lowest.
By contrast, with a decrease in the new supply in addition to the new demand, we expect a balance of the market to return and further vacancy rate to decrease until the end of 2010.
Rents
Prime headline rents during Q1 2010, reduced by 5% quarter-on-quarter.
Prime rental levels are €19-20 per sq m per month for buildings located in the centre area, €14-17 per sq m per month for semi central locations whilst rents for decentralised areas were in range of €9-13 per sq m per month.
According to our estimations, we expect to see further rental decline in the short term with rents expected to hit the bottom of the cycle in the second half of 2010.
