According to “Occupier Economics: Office Market in Katowice in Q1 2020”, a report published by real estate advisory firm Cresa Poland, office take-up in Katowice hit more than 20,400 sqm at the end of Q1 2020, or 42.3% of the annual average for 2015-2019. New leases accounted for 76% of the leasing volume while expansions made up the remaining 24%.
“Katowice’s office market is experiencing rapid growth. The data for the first quarter of this year shows that tenants, especially from the shared services sector, want to remain and grow in the city. Due to the consequences of the restrictions caused by the COVID-19 outbreak, companies are increasingly focused on optimizing occupancy costs,” says Elżbieta Golik, Advisor, Office Department, Cresa Poland.
19,635 sqm was added to the Katowice market in Q1 2020 with the completion of Echo Investment’s Face2Face A, the first phase of the project. Q1 new supply therefore outstripped the total volume of new office space coming on stream in 2019 by 9,745 sqm.
Office projects underway continue without disruption and are expected to be delivered on time. In addition, new projects have been announced: GPP ECO Center (an extension of GPP Business Park) and a building to be delivered in Bagienna Street by OPAL Maksimum. At the end of Q1 2020, Katowice’s office stock amounted to close to 548,000 sqm, up by 5.5% year-on-year.
“In January-March 2020, absorption amounted to 15,100 sqm, accounting for more than 130% of the average for the previous four quarters. Another confirmation of Katowice’s strong growth is the above-average occupier demand for office space recorded in recent quarters,” says Bolesław Kołodziejczyk, PhD, Head of Research & Advisory, Cresa Poland.
The largest office deals in Q1 2020 in Katowice included two pre-let leases in the Face2Face B office building: Capgemini (11,000 sqm) and Honeywell (3,700 sqm.), and a new lease signed by Sii in .KTW I office building (3,100 sqm).
The city’s vacancy rate stood at 6.2% at the end of March 2020, down by 2.6 pp on the same period last year and up by 0.6 pp on Q4 2019.
Rental rates range between EUR 13.50–14.50/sqm/month in Katowice’s higher class office buildings, with lower class buildings commanding rents of EUR 10–12,5/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
