Office space deliveries in Bucharest will decrease this year to 200,000 square meters (sqm), from over 286,000 sqm in 2019, but are expected to reach 500,000 sqm in 2021, according to estimates included in an analysis made by the real estate consulting company Colliers International.
In the medium term, this will predictably increase the competition between developers, and between developers and owners of existing modern buildings, who were left with 140,000 sqm vacant space after some of their tenants relocated last year, according to the report.
Consequently, the tenants will hold increasing bargaining power, a situation described generally as the “tenants’ market”.
The vacancy rate on the Bucharest office market could reach 12-13% this year, up from 10.5% in 2019 according to Sebastian Dragomir, Partner & Head of Office Advisory Colliers International.
Over 365,000 sqm of offices were rented in Bucharest in 2019, up 12% compared to the previous year, representing expansions of existing leases, new tenants entering the Romanian market and relocations from the stock of modern buildings.
At the same time, lease agreements for 144,000 sqm were signed for office spaces to be delivered in 2020 or in subsequent years.
This year is set to be good for the Bucharest office market, with Colliers consultants predicting demand for around 320,000 sqm, of which 120,000 sqm net office space.
As in previous years, IT and financial services companies will be the main drivers of demand in 2020.
The stock of office space in the capital reached almost 2.7 million sqm last year, up 12% compared to the previous year.
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