Office take-up for 2022 as a whole was over 600,000 sqm, of which more than 170,000 sqm was transacted in Q4 alone. Poland’s regional cities overtook Warsaw last year in terms of total office stock. 2023 looks set to be a year of rising occupational costs, strong negotiations and taking steps to ease increases, says the report “At A Glance – Regional City Office Markets Q4 2022”. Another major factor will be the impact of the hybrid work model on the new office reality.
The office markets in Krakow, Katowice and Wrocław continue to grow
The relatively strong supply growth, which regional cities have experienced so far, is expected to decelerate in the next three years. This, coupled with falling vacancy rates, high inflation and fit-out costs, is bound to lead to an upward pressure on rental rates. And beyond that, another important factor will be being able to choose an office in newer, greener and more energy-efficient buildings.
Dorota Mielke, Associate Director, Office Agency
Regional office take-up for 2022 as a whole amounted to over 600,000 sqm, representing a 5% increase year-on-year. Occupier activity was the greatest in Krakow with close to 200,000 sqm of office deals, while take-up in Wrocław and Tricity hit 137,000 sqm and 101,000 sqm, respectively. These figures are evidence of leasing activity in the regional cities gradually returning to pre-pandemic levels. The strongest demand was reported by the IT and business services sectors, which accounted for 26% and 19% of last year’s total take-up, respectively.
says Małgorzata Fibakiewicz.
Office rents up amid stable vacancy rates
Cost optimisation will be this year’s buzzword across all the office markets, including regional cities. In addition, as office fit-out costs remain persistently high and demand for energy efficient solutions continues to grow, leases are likely to be signed for longer periods of up to seven or even ten years, replacing the typical lease length of three to five years. This change is due to both landlords’ need to recoup higher outlays and tenants’ growing awareness of more sustainable office usage.
Agnieszka Witkowska, Consultant, Landlord Representation, Office Sector