Office vacancy rates have finally dropped below 20% in Budapest as a result of the very small amount of development completed in the first part of the year. Only 1,100 sq m of offices were completed in the first quarter.
The effective vacancy rate is much lower, however. A lot of the space now on the market is of relatively poor quality and would not be acceptable to international occupiers. The split in the quality of space available will become more marked over this year as occupiers are cashing in on the low level of prime rents by ´trading up´ in terms of the quality of space they occupy and releasing more poor quality accommodation back onto the market.
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Source: CB Hillier Parker