According to “Office Occupier: Office Market in Wrocław Q1-Q3 2020”, a report prepared by real estate advisory firm Cresa, Wrocław recorded the strongest leasing activity in Q3 2020 among all regional markets. It posted 37% of the total office take-up volume in regional cities.
“Although tenants continue to value Wrocław’s business ecosystem, the city has also seen a substantial increase in sublease listings – especially in sectors where employers have embraced the home office model and office space remains underutilized. The total volume of office space for subletting has already topped 30,000 sqm,” says Klaudiusz Pomykała, Head of the Wrocław Office, Cresa Poland.
“On the one hand, this has created opportunities for clients who previously found lease conditions unacceptable, but on the other this has forced developers to offer more flexibility, especially in the form of shorter lease terms, even in newly-constructed projects. Going forward, this trend may intensify further, depending on how long the pandemic lasts,” added the expert.
Office take-up hit nearly 108,800 sqm in the year-to-date and 46,200 sqm in Q3 2020 alone. Renegotiations accounted for 48% of the leasing volume, followed by new leases (25%), expansions (17%) and owner-occupier deals (10%).
The largest transactions in Q1-Q3 included: two lease renegotiations by Nokia Solutions and Networks Sp. z o.o. of 14 400 sqm in West Link and of 14 100 sqm in West Gate, a lease renegotiation of 10,700 sqm by DXC Technology in Renoma, and a renegotiation with expansion of 10,100 sqm in Bema Plaza by a confidential client.
49,000 sqm of modern office space was delivered to the Wrocław market in Q3 2020 across the following projects: Centrum Południe (23,700 sqm, Skanska), phase one of West 4 Business Hub (14,400 sqm, Echo Investment), and City Forum: City 2 (10,900 sqm, Archicom). Wrocław’s total office stock reached 1.2 million sqm at the end of Q3 2020.
“Office absorption climbed to 29,300 sqm in the first three quarters of 2020 and amounted to 5,200 sqm in July-September, down by 34% comparing to same period of the previous year. Tenants’ activity focused primarily on renegotiations, therefore the share of net demand lowered year-on-year,” says Iga Kraśniewska, Research Manager, Research & Advisory, Cresa Poland.
The city’s vacancy rate stood at 14.3% at the end of September, up by 4.3 pp on the same period last year and up by 3.1 pp compared to where it was in the previous quarter. Asking rents range between EUR 11 /sqm/month 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
