Experts from the consulting company BNP Paribas Real Estate Poland summed up the final quarter of 2021, regarding office space in Warsaw. The market closed the year with 325,000 sqm of new modern space, but vacancy rate are increasing, and an escalation in contract renewals is agitating the situation within the demand structure. Therefore "flexibility" has turned out to be the most important word for all market players. The authors underline that the situation in 2022 will be comparable.
A supply gap to be expected
The supply gap, expected for 2023-2025, will not only leave its mark on the level and the demand structure, but will also be a significant contributor to a hike in rental rates. However, despite the fact that the market is not a bed of roses today, some development companies are not only not suspending their projects, but are also planning their investments, so that they can fulfill the impending supply void as best as possible, and in this way influence the decisions of lease postponement by companies. From a perspective of catching up, the upcoming quarters will certainly foster a significant increase in processes and negotiations that are protracted and even unfrozen from past.
comments Mikołaj Laskowski, Head of Office Agency, BNP Paribas Real Estate Poland.
Vacancy rates on the rise, again
The vacancy rate was largely influenced by decisions made by tenants, who with increased frequency selected the option of extending their existing contracts with a simultaneous optimization of space, rather than the alternative of changing office addresses. We envision, that in 2022 the litmus test for the office market, will be how the market reacts to a return to office desks and further decisions on methods of working within remote or hybrid models, which ultimately will be dictated by the way the pandemic develops.
says Małgorzata Fibakiewicz, Head of Business Intelligence Hub, BNP Paribas Real Estate Poland.