The rental office market stagnates and many offices are empty. A recent study by Retail Management Center shows that investors and developers do not expect the situation to improve shortly. No less than 88% of the interviewed investors and developers tries to solve the problem by rental price adjustements. Only 12% believes that investing in quality improvements will solve the problem.
These results are contradicting those of a study which Retail Management Center undertook on the demand side of the market and amongst office services providers.
Price before quality
For dated offices a downward rental price correction per m2 is expected. But also for new offices, and sometimes even for those offices which still have to be delivered, it appears difficult to find tenants. Special offers, such as 5 year leases for 3 yearsÂ' payments, must tempt potential tenants.
Apart from rental price corrections investors and developers expect that tenants will primarily economize on existing added facilities. Investors and developers are highly critical about their own market. More than 10% consider their market as Â'traditionalÂ'.
Results contradict study on market demand side
Retail Management Center also undertook a study on the demand side of the market and amongst office services providers. Results indicate that tenants want, and are prepared to pay for, full-service packages aimed at the specific needs of tenants on office locations. Suppliers of facilities and other services are optimistic about the possibilities and presently develop modular total solutions, which focus on tenantsÂ' requirements.
Furthermore, the study shows that an ever increasing cooperation amongst tenants requires future developments to take these issues in to account.
(source: Retail Management Center)
