Except Bucharest, the demand on the four large office space sub-markets – Cluj-Napoca, Timisoara, Iasi and Brasov – fell nearly 19% in 2020, to 60,000 sqm, although over half of this area came from a single lease contract, a renewal of over 30,000 sqm in Iasi (Amazon).
Colliers consultants continue to see reasons of optimism on the long term for these markets, which hold a cumulated stock of modern office space of almost 900,000 sqm, namely, less than a third of the supply in Bucharest, in the context of a similar rate of creating jobs in fields that require the existence of an office, with a perspective of acceleration in the future.
As regards the delivery of new office space, 2020 was robust for the Bucharest market, with approximately 156,000 sqm of modern office space delivered, under an initial forecast of approximately 200,000 sqm in early 2021. Also, although there is a big difference compared with the 286,000 sqm delivered in 2019, the level remains pretty robust, at approximately 5% of the current modern office space stock in Bucharest.
Colliers experts expect approximately 250,000 sqm of new modern office space to be completed in 2021, with nearly 40% of this area being pre-leased in early 2021.
Furthermore, Colliers consultants expect a multitude of office buildings scheduled for 2022 or later to be postponed at least until the market re-balances. Normally, there is at least 400,000 sqm for which lease contracts expire every year, and, in 2021, few of them are expected to be renewed, both due to the current economic problems and to the permanent impact of remote work. However, Colliers consultants remain pretty optimistic about the Bucharest office space market on the long term.