Office market in Poland in 2017 r

Warszawa remains the most absorptive and the fastest developing office market in Poland. In 2017, in terms of demand for offices, Warsaw agglomeration crushed the remaining office locations in the country. According to Walter Herz analysts, last year, the capital market in Poland saw a record-breaking volume of leased office space. In 2017, over 820 thousand sq m of offices were contracted in Warsaw. Demand on the Warsaw market proved to be much higher than the total demand for offices on the regional markets.

Warsaw with four times higher demand than Cracow

Cracow with over 200 thousand sq m of leased space remains in the second place. In Wrocław, the demand for offices exceeded 170 thousand sq m last year. Whereas contracts for 113 thousand sq m of office space were signed in the Tri-City. On the Poznań market, 78 thousand sq m of offices found their tenants. In Łódź and Katowice, respectively 59 thousand sq m and 31 thousand sq m of office space were leased.

According to the latest Walter Herz report, the leading Warsaw-based office market at the end of last year offered 5 284 000 sq m of modern space. 2017 saw 27 new buildings in Warsaw, with over 275 thousand sq m of commissioned offices. Most of the new space was built in the district of Mokotów, with 6 office buildings completed, delivering a total of about 72 thousand sq m of space. According to the specialists, currently around 780 thousand sq m of office space remains under construction in Warsaw.

Walter Herz analysts point to the high and unwavering activity of tenants on the capital market, due to which the vacancy rate in Warsaw in 2017 has decreased when compared to the previous year. By the end of 2017, it amounted to 11.60%.

Record-breaking high new supply on the Cracow market

Last year broke a record in terms of new supply on the Cracow market, which increased its offer by 193 thousand sq m of office space. As a result, office resources in Cracow exceeded 1 100 000 sq m, which gives the agglomeration a leading position among the regional cities. According to Walter Herz's calculations, over 300 thousand sq m of office space is still under construction on the Cracow market.

On the second largest regional market in the country, after Cracow, office space supply is slowly approaching one million sq m. In 2017, 54 thousand sq m of new offices arrived in Wrocław and the supply of the market increased to over 906 thousand sq m. About 230 thousand sq m of office space is currently under construction in the city.

Łódź market with an extraordinary dynamic of growth

According to Walter Herz specialists, Łódź office market, which is in the phase of intensive growth deserves particular attention. In Łódź, about 115 thousand sq m of space is under construction and over 74 thousand sq m of offices were commissioned last year. According to Walter Herz, the office supply in this location amounts to 438 thousand sq m of space.

Tri-City has the lowest vacancy rate in the country, which is at the level of 8.5 per cent. Last year, the offer of Tri-City market increased by 66 thousand sq m of office space. At the end of 2017, the supply of offices in Tri-City was approaching 700 thousand sq m, and the construction of 175 thousand sq m of space was in progress.

In Poznań, office market offers 456 thousand sq m of modern space. Another 100 sq m of offices remain under construction. In 2017, only 26 thousand sq m of new space emerged on the Poznań market. Walter Herz specialists note that the consequence of low new supply, is low office vacancy rate recorded in this location, amounting to only 8.6 per cent. An interesting fact is that the largest transaction in 2017 was made in Poznań. Office space, the size of which exceeded 25 thousand sq m, was leased in the Nowy Rynek building.

Katowice overtook Poznań

Katowice, which is currently the fourth regional market in Poland, managed to overtake Poznań in terms of the size of the offered supply, although only 17,5 thousand sq m of new space was commissioned last year. The total office supply in Katowice agglomeration amounted to 461thousand sq m at the end of last year, and 60 thousand sq m of offices were under construction.

Walter Herz experts point out that due to such high activity of developers, which so far has never been seen in the history of the industry, office market in Poland gained a record number of office space in 2017.

According to analysts, rental rates in the regional cities range from EUR 12.00 to EUR 17.50 / sq m /month, and in Warsaw they range from EUR 11.50 to EUR 23.00 / sq m / month.

Walter Herz report is available on: https://walterherz.com/en/a/office-market-in-poland-in-2017

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Office market in Poland in 2017 r

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