Office space rents are more flexible than at the beginning of the year

November 1, 2022by fortadmin

BUCHAREST, 31st March 2022

The rents of class A offices, of the premium buildings, which have free spaces for rent in Bucharest are between 12.5 euro/sqm/month in the southern area and 18.5 euro/sqm/month in CBD, the best listed office area, according to an analysis by Fortim TA, a member of the BNP Paribas Real Estate Alliance. In the Pipera-Voluntari area, rents for class A office spaces fall on time and up to 8 euro / sqm / month.

In the first three months of 2022, office tenants in Bucharest preferred either premium office buildings (top areas and superior quality of space, recently opened or being delivered), or offices where the owners offered more benefits.
“The office market is stable in premium areas, such as the Central Business District (CBD) and Floreasca-Barbu Văcărescu, where no new office buildings are expected to be delivered soon. Landlords maintain rents from past years but offer additional benefit packages. Under these conditions, the net rent can decrease by 10-15%. On the other hand, deliveries of new space are slowing down this year, with 40% less space expected to be put into use than in 2021, which means that at the end of the year we may have another relationship between demand and offer and implicitly another level of rents”, says Nicolae Ciobanu, Managing Partner – Head of Advisory, Fortim TA, member of the BNP Paribas Real Estate Alliance.

At the top, in the first place in terms of rents is the CBD (Central Business District) area, around Victory Square, to Charles de Gaulle Square, where the net rent for class A office space is between 16.5 euro/sqm/month and 18.5 euro / sqm / month, in 2022. For class B office spaces in this area, rents decrease by up to 12 euro / sqm / month.
In second place is the central area (delimited by the central ring), where there are usually boutique office buildings and where the rents of class A offices are between 16.5 euro/sqm/month and 18 euro / sqm / month.
On the third place in terms of rents in Bucharest is the Floreasca – Barbu Văcărescu area, where the rents of class A office spaces are between 15.5 euro/sqm/month and 17.5 euro / sqm / month.
It should be noted that in all these three areas of the Top 3, the stock of offices is in modern buildings.

The northern area experienced a revival in 2021 and continues to generate increased interest in 2022 as well, which led to a slight increase in rent in this area, up to 15.7 euro / sqm / month, for class A spaces, most migrating from the Pipera-Voluntari area or other areas without direct access to the subway.

The western area is also in a real estate boom, but the large number of office buildings that are under construction or recently delivered puts a slight pressure on rents, so that the level of net rents is two percent lower in this area compared to the area Floreasca-Barbu Văcărescu. Now, however, competition between developers has set net rents for class A office space in the western area between 13.5 euros/sqm/month and 15.3 euros/ sqm/month, and for class B between 8 euros/sqm/month and 13 euro/sqm/month.

Office space rents are more flexible than at the beginning of the year - FORTIM TRUSTED ADVISORS

How the rents of office spaces have evolved in Bucharest

The level of the first rent at the office spaces in Bucharest remained constant at the beginning of this year, both in terms of class A and in terms of class B, according to a monitoring carried out by Fortim T.A., member of the BNP Paribas Real Estate Alliance.

Bucharest versus other large European cities with strong business centres

In Europe, class A offices in Bucharest are the cheapest, according to a report made at the level of the Paribas Real Estate BNP Alliance, with the information where the member companies are present. Thus, if in Bucharest at the beginning of this year the premium rent for office spaces is 18.5 euros / month / sqm, in Prague and Warsaw the premium rent is 24 euros / sqm / month, in Vienna and Budapest 26 euros / sqm / month.

About Fortim Trusted Advisors, Alliance Member of the BNP Paribas Real Estate

Fortim Trusted Advisors, an Alliance Member of the BNP Paribas Real Estate in Romania, is a company of real estate consultancy created in 2002 and since December 2020 is supervised by Costin Nistor, Bogdan Cange and Nicolae Ciobanu. The company provides services of real estate consultancy in the area of office, retail, industry & logistics, assessment, capital markets, research, yet it also provides services of Property Management and Project Management. In the area of Property Management, the company administrates over 115,000 sqm of office stock, retail and industrial stock. Among the most important recurrent clients of Fortim Trusted Advisors are Morgan Stanley, Add Value Management, Indotek, Kesz and First Property Asset Management. At the same time, on the office stock segment, the company took charge of office space trading for Reckit Benkiser, Renault, Fortech, Grohe, Credius, OLX Group, Multinode Network, AHI Carrier, AVL,UMT Software, Future Electronics, The Home or Bioderma.