Demand on Bucharest’s office market halves in Q1
The gross volume of office spaces rented during the first quarter (Q1) in Romania dropped to 55,000 square meters (sqm) - half the figures in Q4 and Q1 last year.
As the supply strengthened, the vacancy rate on the office segment increased from 7.7% in Q4 2019 to 8.7% in Q1 this year.
After a very good 2019, the pace was maintained in the first quarter, and the office buildings completed at the beginning of the year added 78,200 sqm to the stock of modern offices in Bucharest.
The demand must have been subdued in Q2, and the outlook remains uncertain amid the complicated sanitary situation prompted by the coronavirus pandemic, real estate consultancy firm JLL explained.
The net volume of rental transactions on the office market was 19,200 sqm or 35% of the period's gross amount. Compared to the first quarter of 2019, it stood at 46%.
Although expectations were high at the beginning of the year, following a solid 2019, the emergence of the COVID-19 pandemic in Europe towards the end of the first quarter led to a sharp slowdown, with a direct impact on the volume of transactions.
"It is difficult to estimate the volume of transactions for 2020 because there are many unknown factors and uncertainties related to COVID-19," said JLL consultants.