TriGranit reports a strong start to 2016, its first year backed by a new owner, TPG Real Estate. In Q1 2016, new leases and renewal agreements reached 25,777m² GLA, the average occupancy rate is over 95% in TriGranit managed assets, and the company has 20,000m² GLA office development in progress. Due to the strong performance of the BPO sector in the region, the company plans further office developments in the near future in each of its core countries: Poland, Hungary and Slovakia.
Reflecting the active office market in the region, almost 20% of the entire TriGranit managed portfolio was composed of renewals or new agreements - 16,729.6m² GLA in renewals and 9,047m² GLA in new lease agreements has been closed in Q1 2016. The most active asset was Millennium Towers in Budapest, with altogether 19,010.7m² GLA in renewals and new leases, including agreements with Morgan Stanley and Oracle. With these agreements, the occupancy level of the Millennium Office Towers has reached 99%.
The year started positive also in Krakow’s most popular and respected office park, Bonarka for Business - while the sixth tower, Building “F” will be ready in the next quarter of 2016, and Building “G” is planned to open in the first half of 2017, over 60% of the whole office space is already leased. The eight-storey buildings with 10,000m² GLA each, will offer a modern, employee friendly office space with BREEAM certification, fully taking into consideration the tenants needs.
“The good performance of our assets also reflects the trend: the CEE real estate market’s recovery is still on the go – slower, but still above the Western European level. There is continuously growing demand from multinational companies for ‘near-shoring’ – Central Europe has become a ‘traditional’ European destination for the BPO sector, especially Polish secondary cities like Krakow, Wroclaw and Lodz due to the large pool of cheaper, but effective and well-educated labour with strong language skills in addition to developed infrastructure.” said Árpád Török, CEO of TriGranit.
It’s a fact that many US and Western European companies choose CEE for their BPO headquarters, aiming to save costs by relocating these functions from Western Europe or the US to CEE. The BPO/SCC segment, with 150,000 people in Poland in 2015, was the second largest after mining. The BPO sector occupies approximately 50% of the existing Polish regional office stock. The most typical BPO companies in Poland are in IT, accounting, R&D and finance. But the other large cities in the region, Budapest and Bratislava, are also number-one targets for BPO companies in the region.
TriGranit’s main shopping centre, the Bonarka City Center (one of the leading shopping centres in Krakow) welcomed almost 3.4 million visitors in Q1, offering customers regular interesting events like the Great National Charity Event, the biggest Charity Event in Poland, the Women’s Day Health Event or the Spring Fashion Show involving the largest tenants. Compared to the similar period in 2015, the turnover of the mall increased with 6% in Q1 2016. The unique sales & CRM tool, Rabatomat, an interactive, touch-screen based tool providing not only full information about actual offers in BCC, but offering customers coupons after purchases, is still a popular loyalty tool in BCC. Almost 40% of BCC tenants participated in Rabatomats by giving away special offers, while there have been nearly 12,000 coupons printed out by customers in Q1 2016. Due to a new lease renewal with Pandora, the mall’s occupancy rate is 94%. American New Balance Performance signed a five-year agreement, and the Turkish company, English Home and Camaieu also opened new stores in BCC.
The year also started positively for Lakeside Park in Bratislava, where the team has managed to close five deals, and the transactions include two new tenants entering the scheme and a successful renewal with three key tenants. The occupancy rate of the office building has reached 95%.
