More offices and residential units in Katowice – developers’ record-breaking activity

In the first six months of 2021, over 39,000 sqm was leased  in Katowice. Nearly half of these were contract renegotiations. Uncertainty in the market and the fact that many tenants are in the process of developing new workplace  strategies are currently holding back key leasing decisions,

comments Dorota Gruchała, Head of Kraków Office, JLL.

From 2020 to the end of June 2021, five new office buildings with a total of approx. 62,800 sqm were delivered to the market. A further approx. 160,000 sqm is currently under construction, the second highest among regional markets. However, it is worth noting that the vast majority of this volume will be delivered to the market in 2022. As a result, Katowice will be seeing a record increase in supply. By the end of this year, approx. 10,000 sqm will have been delivered, which in turn may contribute to a slight increase in vacancy rates,

explains Ewa Grudzień, Senior Research Analyst, JLL.

It is possible that some of the investments planned for 2022 will be put back to 2023. This will depend to a large extent on what impact the pandemic and return-to-office strategies will have on the market in H2 2021 and H1 2022,

comments Dorota Gruchała, an expert at JLL.

The return to high sales figures was made possible by significantly higher introductions. In other large markets, sales are increasingly dependent on supply. However, in the case of Katowice, buyers still have a choice. It should also be remembered that Katowice is slightly behind the main six cities in the market cycle. While in most of the largest markets (Warsaw, Kraków, Wrocław and Tri-City) the sales peak took place in 2017, in Katowice the best sales result - 2,500 units - was recorded in 2019. The arrival of the COVID-19 pandemic in 2020 clearly disrupted the rising volumes of both new launches and sales,

comments Katarzyna Kamińska, Manager, Residential Research, JLL.

The high level of interest in purchasing flats can be seen in all large markets. However, in Katowice demand has still not exceeded supply to the same degree as in other locations. What’s more, the results of the first six months of this year even indicate a slight surplus of new flats coming onto the market,

comments Katarzyna Kamińska, an expert at JLL.

Focusing on the recent quarters, it is worth emphasizing that the prices of flats in Katowice grew in line with those in other major agglomerations - by 5% q-o-q and by 11% y-o-y. Although the price of over 8,000 PLN/sqm in Katowice is at an all-time high and comes close to the price level we currently have on the market in Poznań, the exceptionally high sales recorded in recent months show that buyers are still able to accept these purchase prices,

explains Katarzyna Kamińska, an expert of JLL responsible for residential market monitoring.