Transacted office space in Bucharest reached approximately 237,000 sqm in 2020, down 39% compared with 2019, but renewals grew to account for 45% of the total from 21% in 2019.
The most important office project completed in the last quarter of 2020 was One Tower, with a lettable area of 24,000 sqm, part of the mixed project One Floreasca City.
Total office market deliveries 2020 totaled 155,000 sqm, down 46% compared with 2019.
At the end of the year, the degree of offices use remained relatively low, with less than half of the employees coming to the office workplace regularly, given that most companies continue to operate in work from home or hybrid systems.
“In the current context, we will see a challenging start to the new year for office space owners, who need to adapt their buildings to convince employees that they can return to the office workplace and work in a safe space from the sanitary point of view,” said Madalina Cojocaru, Partner, Office Agency, Cushman & Wakefield Echinox.
Commercial stock (destined for lease) of office buildings in Bucharest amounts to approximately 2.95 million sqm, other buildings with an area of approximately 150,000 sqm are occupied by the owners, while projects with a total area of 350,000 sqm are currently under construction and scheduled for delivery in 2021-2022.
In this context, the (contractual) vacancy rate of office spaces is 12.5%, with a significant difference between class A (9.7%) and class B (20.7%) spaces.
“We noticed that an important part of the transactions signed at the end of 2020 were pre-leases, a positive aspect that reveals that certain occupiers notice the favorable context, in which they can obtain attractive commercial conditions and can make an upgrade in terms of location and quality of space occupied,” Cojocaru added.
Both developers and investors remain optimistic about the strategic importance of office space, considering the continued activity on construction sites and important acquisitions signed in 2020, which was a record year in terms of real estate office transactions on the local market.
The most important office projects under construction are One Cotroceni Park, J8 Office Park, Globalworth Square, U Center, Miro Offices, Țiriac Tower, Dacia One, Millo Offices, @Expo, and Sema London & Oslo, where developers have signed pre-lease contracts for about 60% of the spaces.