JLL has summarised the situation on the office markets in Warsaw and other major Polish cities at the end of Q1 2016.
Anna Młyniec, head of office agency and tenant representation at JLL, commented: “In Poland, office lease agreements for a total of 250,400m² were signed in Q1 2016. Major office markets outside Warsaw accounted for 108,200m² of this number. The highest take-up was recorded in Warsaw – 142,200m², followed by Kraków with 39,400m². We expect an increase in tenant activity in the upcoming months.”
“The modern business services sector remains a key office tenant on major Polish regional markets, accounting for approx. 63% of demand registered outside Warsaw in Q1 2016. In Wrocław, companies from the sector accounted for 83% of the city's quarterly office take-up, in Katowice – 81% and in Kraków - 74%,” added Anna Młyniec.
Supply
By the end of Q1 2016, total office stock in Poland reached approx. 8.3 million m². 218,000m² of new office space was delivered to market (113,000m² in Warsaw and 105,000m² in other locations) in Q1 2016.
“Currently, there is approx. 1.5 million m² of office space under construction throughout Poland. The largest developer activity is in Warsaw, where 662,000m² is under construction, followed by Kraków - 284,000m², Wrocław - 170,000m² and Łódź - 106,000m². According to our preliminary forecasts, the Polish office market is likely to grow by 900,000m² in 2016”, says Mateusz Polkowski, associate director, research and consulting, JLL.
Vacancy rate
Vacancy rate in Warsaw was 14.1% by the end of Q1 2016. Outside Warsaw, the lowest vacancy rate was registered in Kraków (5.7%) while the highest was recorded in Szczecin (18.3%).
Rents
Prime headline rents in Warsaw’s city centre averaged out at between €21 and €23.5/m²/month. Outside the city centre, rents vary between €11 and €18/m²/month. As for major office markets outside Warsaw, the lowest rents are recorded in Lublin (€11 – €12/m²/month) while the highest can be found in Poznań and Wrocław (€14 – €14.5/m²/month).
