According to “Occupier Economics: Office Market in Tricity in Q1 2020”, a report published by real estate advisory firm Cresa Poland, office take-up reached nearly 33,100 sqm in the first quarter of 2020, representing approximately 34% of the annual average for 2015-2019. Tricity’s vacancy rate edged down by 1.3 pp quarter-on-quarter to 4.1% at the end of March, the lowest among all the core regional city office markets.
“The Tricity market reported a solid start to the year 2020. Despite many challenges resulting from the COVID-19 pandemic, tenants continue to be interested in conducting business in this region. Of all Polish cities, Tricity offers the highest quality of life, an important factor driving companies to open offices on this market. It is being increasingly targeted by international firms for local BPO/SSC/GBS operations. Development activity continues unabated. The development pipeline scheduled for delivery this year stands at more than 45,000 sqm of office space across four projects, including revitalisations. Tenants looking for office space will have many options to choose from,” says Michał Rafałowicz, Head for the Pomeranian Region, Cresa Poland.
No new office building was added to the market in the first quarter of 2020. Office completions scheduled for delivery in the coming quarters include the Dyrekcja building of the Imperial Shipyard and Building A of Wave.
At the end of Q1 2020, total office stock in Tricity stood at 838,500 sqm, up by more than 4% on the average for the previous four quarters.
The largest transactions in Q1 included two leases in the Alchemia IV (Neon) building of 12,100 sqm (confidential tenant) and 4,500 sqm (New Work), and a pre-let of 3,300 sqm in the Wave A building (Spaces). New leases accounted for 89% of all deals. 30% of the demand came from flexible office operators.
“Absorption hit 6,500 sqm in January-March, representing a 61% decrease on the average for the previous four quarters. And yet, the market is expected to return to positive growth given the anticipated volume of new supply later in the year,” says Bolesław Kołodziejczyk, PhD, Head of Research & Advisory, Cresa Poland.
Asking rents range between EUR 13,50 – 17,00/sqm/month in higher grade modern office buildings, with lower grade buildings commanding EUR 10.50–13.00/sqm/month.
Cresa is the world’s largest commercial real estate advisory firm that exclusively represents occupiers and specializes in the delivery of fully integrated real estate solutions. It serves clients through more than 80 global offices. Cresa Poland offers unbiased, independent commercial real estate advice. Its integrated services include conflict-free tenant representation, capital markets, market research and advisory, valuation, design & project management and workplace strategy. Cresa Poland is headquartered in Warsaw, with regional offices in Wrocław, Tricity, Łódź and Krakow. To learn more, please visit: www.nmrk.pl
