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| Warsaw sees take up meet supply as market stabilizes Lease renegotiations are driving Warsaw's office market accounting for 40% of deals, according to London-based real estate services firm Savills. This demand has significantly contributed to net take up levels, which are now in line with supply and indicate the market is showing signs of stabilizing. The international real estate advisor suggests that with quarterly levels of office take up now exceeding 100,000 m² and new development activity decreasing, there is potential for rental growth to occur in this market in 2011. The report outlines headline rents are now stable at €25/m²/month within the CBD and €14.50/m²/month in non-central locations. Brian Burgess, Head of Savills Poland, says: "Renegotiations still constitute a significant part of 'take-up', however, net take-up is already in line with the level of new supply. We expect the market to remain stable in the second half of 2010 and for first signs of rental growth in 2011 once the vacancy rates decrease." In terms of deal size, typical transactions are a modest 800 m² on lease lengths of five years. Vacancy remains at an 8% high, with 3,382,000 m² of office stock available at end H110 but demand is constant due to the significant rental decreases that took place over the past 24 months. In terms of investment, Warsaw's office market has accounted for nearly 40% of overall investment activity at €6.3 bln. since 1998. H110 saw six transactions totaling €300 million – yields stand at circa 7% with prime CBD properties predicted to achieve 6.75%. write your comments about the article :: © 2010 Construction News :: home page |