More and more companies are returning to their offices by implementing a hybrid model of work. The prolonged use of this working model has translated into a lower volume of transactions. The technology sector still remains the most active.
Demand – dominance of technology companies
There is a growing awareness that the challenges caused by the pandemic will be with us longer than initially anticipated. This is why many companies, which are experiencing the negative effects of remote working, are developing a new operating model and returning to offices by utilising a hybrid model. There is a need to strengthen the sense of belonging, deepen trust and integrate a company’s team. For many employees, working in an office also helps in achieving a work-life balance. However, in-depth requirement analyses and preparation of long-term strategies are time-consuming. These factors have translated into lower transaction volumes”,
says Maciej Traczyk, Senior Consultant, Tenant Representation, JLL.
Once again, the highest activity was recorded in Kraków, Tri-City and Wrocław. These three markets account for more than 70% of lease agreements outside of Warsaw in the first three quarters of 2021”,
adds Maciej Traczyk, Senior Consultant, Tenant Representation, JLL.
Supply – twice as much under construction outside Warsaw
Poland's largest regional office markets account for a third of new supply this year. In the first three quarters of 2021, 145,800 sqm was completed in these locations, compared to 436,000 sqm nationwide. A total of 1.12 million sqm of modern office space is currently under construction. This is just under 14% less than a year ago and represents an eight-year low. This is mainly due to the record low activity of developers in Warsaw – 330,000 sqm. The main regional markets have more than twice as much under construction – around 770,000 sqm”,
says Ewa Grudzień, Senior Research Analyst, JLL.
Investment market
Since the beginning of the year, office investment transactions worth over EUR 1.2 billion have been concluded in Poland. This represents a 19% drop on the same period last year. However, despite lower investor activity, the result for the first three quarters of 2021 is still 4% above the 10-year average. The main markets outside Warsaw accounted for less than EUR 380 million, or around 30%. This result was largely achieved thanks to a portfolio transaction involving the office buildings of the BUMA Group, acquired by Partners Group for over EUR 200 million. The fact that most of this portfolio is located in Kraków meant that this the city’s market saw the highest activity”,
comments Marcin Sulewski, Head of Office Investment, JLL.
Vacant space and rents
[1] Kraków, Wrocław, TriCity, Poznań, Katowice, Łódź, Lublin and Szczecin.
