Total demand for modern office space of 68,800 square meters was flat on a year ago and compared with the average of the last four quarters, but new demand was just 22,200 square meters, down 39% compared with the same period last year, according to Colliers’ data.
Even so, the near-term outlook remains encouraging, with Colliers estimating that vacancy rates for Class A office space could fall to single digits by the end of the year. This will tip the balance further in favor of a landlord’s market, although the trend could be partially offset as some large companies may sublet some of their office space or reduce their footprint in the context of hybrid working.
Around 100,000 square meters of modern office space was delivered in the first three quarters of 2022, with AFI Tech Park (Phase 2, 25,000 square meters) and Hagag Development Europe’s H Tudor Arghezi 21 redevelopment project (7,000 square meters) being the newest projects added to the modern office stock in Bucharest.
Phase II of One United’s One Cotroceni Park and Equilibrium, the office park developed by Skanska, should also be completed by the end of the year, adding around 50,000 square meters of new, modern office space that will increase Bucharest’s stock to almost 3.36 million square meters.
By sector, IT&C companies continue to dominate the rental market, accounting for around 47% of total demand, followed at a distance by professional and business services, with 27% of total demand.
Colliers notes that the expansion or even entry of high-tech companies into the Romanian market is a good thing for the long-term prospects of the office market.
(English version by Loredana Fratila-Cristescu)