The amount of office space rented increased 50% in the major cities of Romania, according to CBRE data.
The largest deal on the office space market in the first quarter is the lease Vodafone signed for 16,000 square meters in Bucharest One office tower in the northern part of the city, developed by businessman Ioannis Papalekas, according to a ZF analysis based on the data provided by real estate consultants.
Other important transactions were several rental contracts signed for about 3,000 square meters of office space, two of which in buildings in Timisoara and Cluj, which are beginning to compete with Bucharest over investors by offering lower rents and lower salary costs.
Rolling stock manufacturer Bombardier, which has a maintenance contract with the Bucharest subway company, early this year renegotiated its lease and expanded the office space taken up in Power Business Center in Cluj by 2,900 square meters, while a professional service company rented 2,900 square meters in Timisoara.
Document management company Recall rented 690 square meters in Cluj to open an office in the Liberty Technology Park, while SAP group relocated to an almost 1,000 square meter space in Cluj Business Center.
Another IT industry company, Microsoft, rented 1,000 square meters in Optica Business Park in Timisoara. The total amount of space in the five rental deals is 8,500 square meters or 37% of the entire amount of office space traded in Romania in the entire 2013.
At the same time, Iulian Dascalu, owner of Iulius Group, on Thursday announced he had expanded the space rented by service provider Office Depot in the Iulius Business Center Cluj from 3,800 to 4,500 square meters and extended its lease by five years as the company is considering expansion of its team by another 100 employees.
“One of the trends in the first quarter is the increase in number and volume of transactions outside Bucharest – multiple deals for more than 1,000 square meters closed in Timisoara, Cluj-Napoca and Iasi,” said Razvan Iorgu, managing director of CBRE Romania.
“Compared with the 2013 average, total demand in the first quarter of 2014 is almost 50% higher. We will obviously see an increase in interest in the main cities besides Bucharest this year, with a focus on (…) Cluj Napoca, Timisoara and Iasi.”
The differences compared with the Bucharest office space market are still significant, though. A recent survey by real estate consultant DTZ Echinox shows the office space stock in Cluj, Timisoara, Brasov and Iasi taken together stands at about 450,000 square meters, less than one quarter of the office space stock in Bucharest. Therefore the most important deals continue to be closed in the capital city.
A total of 61,000 square meters of office space were leased in Bucharest in the first quarter of the year, according to preliminary data centralized by consultant Colliers, which brokered deals for more than 30,000 square meters in the period considered, including Vodafone group’s consolidation into a 16,000 square meter space in Bucharest One.
Colliers data also show that net demand, which includes only expansion, new entries on the market and relocation from non-competitive buildings rose by 40% in the first quarter to 32,000 square meters.
The companies that signed important leases on the office space market in Bucharest in the first quarter include Schneider Electric, which pre-leased 3,100 square meters in Green Court developed by Sweden’s Skanska, UK’s Endava, set to move from AFI Park 1 into a 5,000 square meter space in AFI Park 3 at the end of the year and games developer KING, set to move its Bucharest office to Opera Center.
(English version by Loredana Fratila-Cristescu)