According to “Office Occupier: Office Market in Wrocław”, a report published by real estate advisory firm Cresa Poland, the leasing volume hit 45,900 sqm in the first half of 2021, accounting for 33.9% of the annual average for 2015-2020. New leases accounted for most of the leasing volume (68%), while renegotiations made up 28% in H1.
“Research shows that employees in Wrocław want to return to the office, but most of them prefer a hybrid work model. Occupier activity has clearly picked up on the office leasing market compared to the previous year, when many companies put relocation decisions on hold. Buildings with high-tech solutions such as antibacterial air-conditioning or contactless operation are in demand. Asking rents remain unchanged, but landlords have embraced a more flexible approach to negotiations of lease financial conditions due to higher vacancy rates,” says Izabela Kołcz, Advisor, Cresa Poland.
Wrocław saw its office stock expand by 4.8% year-on-year to 1.24 million sqm at the end of the first half of 2021. Only one office building was added to the Wrocław market in the second quarter of 2021: Krakowska 35 (Atal, 11,800 sqm). It was also this year’s first office completion in the city. The development pipeline comprises more than 112,000 sqm of office space.
Office take-up reached 45,900 sqm in the first half of 2021. Of that total, 24,400 sqm was transacted in the second quarter, up by 65.7% on the same period last year. New leases in Q2 accounted for most of the leasing volume (79%), while renegotiations made up 21%. There were no expansions or owner-occupier deals.
The largest transactions in H1 2021 included: a prelet of 12,300 sqm in the MidPoint 71 building by 3M Service Center EMEA, a new lease in the Carbon Tower (4,500 sqm, a confidential tenant from the financial sector), and a renegotiation of 4,200 sqm in the Globis building by Unit4.
Office absorption for the first half of 2021 reached 20,200 sqm, representing a 16.2% decrease on the same period last year. In the second quarter alone, the Wrocław market absorbed close to 10,600 sqm of office space.
The vacancy rate stood at 14.1% at the end of June 2021, down by 0.1 pp on the previous quarter but up by 2.9 pp compared to the same period last year.
“Wrocław’s vacancy rate continued its downward trend in the first two quarters of 2021, which was driven, among other things, by limited new office supply and relatively high gross take-up averaging 21,000 sqm,” says Iga Kraśniewska, Research Manager, Research & Advisory, Cresa Poland.
Asking rents range between EUR 10 /sqm/month outside city centre and EUR 16 /sqm/month in the city centre.
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. To learn more, please visit: www.nmrk.pl
