Moscow office occupier activity is getting back to normal (RU)

Moscow office area

According to JLL, the Moscow office market saw no completions in Q2 2017. This extended the recent trend of delayed deliveries.


Until the end of 2017, 542,000 m² of new offices are expected to enter the market. In the first half of the year, only 21,143 m² were completed, implying that almost all completions this year will take place in H2. The bulk of space will appear to projects in Moscow City: IQ-Quarter, Federation Tower East and OKO (Phase II).


The total volume of transacted space was 283,477 m² in Q2 2017 (10% lower YoY) and 450,480 m² in H1 2017 (a 22% decrease YoY). However, the take-up expected by the end of 2017 (1.1m m²) will be roughly the same as last year.


The Moscow office market is gradually shifting towards normal activity, with prevalence new leases and relocations. The pickup in transacted space after a drop in Q1 2017 as well as the restoration of new leases and relocations indicate the beginning of a Moscow office market recovery.” – says Elizaveta Golysheva, National Director, Head of Office Agency, JLL, Russia & CIS. – “Thus, the share of renewals and renegotiations continues to decline, reaching 19% in H1 2017 versus 49% in 2016 and 64% in 2015.”


Geographically, a large share of transactions has been signed in decentralized locations outside the Third Transport Ring (36%), while the CBD accounted for 18% of take-up in H1 2017.



In the demand structure the following business sectors were most active in H1 2017: banking & finance (40%), business services (23%) and manufacturing (18%). Note that banking & finance maintained its leading position.


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