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| Warsaw to see office development accelerate as city centre expands to the West Savills latest Warsaw office market research reports development is expected to accelerate with over 47 office buildings currently under construction in the city, equating to over 672,000 sq m of office space. This, the firm says, will see the boundaries of the City Centre push to the west with the markets of ul. Towarowa and Rondo Daszynskiego gaining popularity with developers. Tomasz Buras of Savills office agency team in Poland says: "The pace of development is accelerating. The office market is likely to grow to over five million sq m by end of 2016, representing growth of one million sq m in only three years. Developer confidence remains high with over half of properties built speculatively." Savills data confirms new supply is anticipated to exceed 300,000 sq m for the year. This is against 518,000 sq m of office space lettings in Warsaw so far this year, with prime headline rents reaching €22.00-23.00 sq m/month. Lettings activity in Q3 13 reached 184,600 sq m, the second highest quarterly volume since 2005, with full year data expected to break another record at circa 650,000 sq m take up. This the firm suggests may push vacancy rates down to 10.1% by year end. According to the research, only 30% of total lettings this year have been in the form of lease renewals, with overall demand for office space mostly created by new space acquisitions, expansions and consolidations. Also, the number of new companies that open their first office in the city is lower than several years ago, hence in house office demand is dominant. Dorota Ejsmont of Savills office agency team in Warsaw adds: "As there is growing activity from large occupiers with requirements of above 10,000 sq m, we should see longer lease contracts of 10 years and more in the buildings they choose." In terms of 2014, Savills says supply is expected to reach over 342,400 sq m – over 28 projects in total. Whilst demand continues, Savills notes this continued supply may push vacancy rates back out to 11.6% in 2014 and 12.4% in 2015. write your comments about the article :: © 2013 Construction News :: home page |