05. Juli 2012 
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Over 750,000 m² of office space might become available in Bucharest
The next three years unfold significant opportunities for the office market, with nearly 754,000 m² of office spaces that will make the object of renewals and renegotiations in Bucharest, according to a recent study published by the Valuation & Advisory Services team of Colliers International in Romania. Demand will derive from the contracts that will reach maturity in the period comprised between 2012 and 2014.
The Colliers study shows that over 90,000 m² of office spaces are comprised in the contracts that will reach maturity this year. In 2013 and 2014, the total surface of office spaces to become available will increase considerably, as a consequence of the expiration of contracts signed during the real estate boom of 2006-2008. Thus, most likely a large share of the clients with contracts expiring each of these years will take advantage of their position and try to obtain better deals.
“The companies who will most likely ask for new offices are those that either occupy old office areas that do not meet the quality standards for a class A office space or that run their businesses in a number of different premises and aim for a single consolidated location or need larger spaces for which the actual building cannot offer available solutions”, stated Daniela Popescu, Senior Associate in the Valuation and Advisory Services team of Colliers International Romania.
The hit of the financial crisis modified the mechanism of the office market and most of the decisions were taken on the cost cutting principle. At the same time, as the traffic conditions in the city worsened, accessibility became one of the most important attribute of a new office space, the presence of the metro station within walking distance being mandatory. Thus, the headquarters will sacrifice the traditional CBD locations for more advantageous rent levels and will move towards the semi-central locations. The companies occupying spaces in areas which witness difficult accessibility will most likely relocate in office buildings located near metro stations at the expense of the rental budget.
Apart from the previously mentioned situations, tenants witnessing the expiration of their contract would rather choose a renewal in the spaces they already occupy unless they benefit of fit out budgets in other locations. Usually, when moving to a new office space, companies need to consider a budget for relocation. However, currently the developers are more willing to offer fit out budget contributions as an incentive to attract tenants in their projects.
In addition to the office spaces that will become available as a result of expiring contracts, the next three years will see new project deliveries on the Bucharest office market, especially in the semi-central areas where over 170,000 m² of new office spaces have been announced.
Maria Florea, Associate Director of the Office Agency team of Colliers explains: “In 2011, new and existing developers regained their optimism regarding the Bucharest market and re-evaluated the opportunity to build. As some of the projects delivered or announced on the market in the last 18 months have already proved, new buildings will have higher technical specifications and will be better designed, in attempts to address the more complex needs of clients.”
The Colliers study shows that over 90,000 m² of office spaces are comprised in the contracts that will reach maturity this year. In 2013 and 2014, the total surface of office spaces to become available will increase considerably, as a consequence of the expiration of contracts signed during the real estate boom of 2006-2008. Thus, most likely a large share of the clients with contracts expiring each of these years will take advantage of their position and try to obtain better deals.
“The companies who will most likely ask for new offices are those that either occupy old office areas that do not meet the quality standards for a class A office space or that run their businesses in a number of different premises and aim for a single consolidated location or need larger spaces for which the actual building cannot offer available solutions”, stated Daniela Popescu, Senior Associate in the Valuation and Advisory Services team of Colliers International Romania.
The hit of the financial crisis modified the mechanism of the office market and most of the decisions were taken on the cost cutting principle. At the same time, as the traffic conditions in the city worsened, accessibility became one of the most important attribute of a new office space, the presence of the metro station within walking distance being mandatory. Thus, the headquarters will sacrifice the traditional CBD locations for more advantageous rent levels and will move towards the semi-central locations. The companies occupying spaces in areas which witness difficult accessibility will most likely relocate in office buildings located near metro stations at the expense of the rental budget.
Apart from the previously mentioned situations, tenants witnessing the expiration of their contract would rather choose a renewal in the spaces they already occupy unless they benefit of fit out budgets in other locations. Usually, when moving to a new office space, companies need to consider a budget for relocation. However, currently the developers are more willing to offer fit out budget contributions as an incentive to attract tenants in their projects.
In addition to the office spaces that will become available as a result of expiring contracts, the next three years will see new project deliveries on the Bucharest office market, especially in the semi-central areas where over 170,000 m² of new office spaces have been announced.
Maria Florea, Associate Director of the Office Agency team of Colliers explains: “In 2011, new and existing developers regained their optimism regarding the Bucharest market and re-evaluated the opportunity to build. As some of the projects delivered or announced on the market in the last 18 months have already proved, new buildings will have higher technical specifications and will be better designed, in attempts to address the more complex needs of clients.”
