Tag Archives: 2017

Market report 2017 H1 Modern Offices

Calm before the storm

There was a significant decrease in the growth of supply in the first half of 2017 compared to last year’s data, with only one new building being handed over (Graphisoft Park, 5,500 sqm). On the basis of current data developers’ activity is going to be more moderate compared to the year of 2016 and to previous expectations.

Ongoing property developments make up around 400 square metre office space, the major part of which (316 thousand square metre) is expected to be handed over only in 2018. Two hotspots of property development are the office corridor on Váci Street and sub market in south Buda. The dominance of Váci Street is expected to continue its growth in the near future, the size of handed over modern office stock of the region is going to surpass one million square metres by the end of next year. In the south Buda submarket, which with 3% has the lowest vacancy rate, completion of new offices (over 110 thousand square metres) can be expected a year later, in 2019.

The two biggest handovers in the second half of this year are going to take place in the south Buda submarket (Office Garden 3 and Hungarian Nobel prize winners Research and Development Park I); 42 thousand square meters of office space are going to be handed over in the two office buildings, which account for more than half of the annual growth in demand.

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Market report 2017 H1 Industrial and logistics properties

Dynamically expanding developments

In the first six months of 2017 properties of about 49 thousand square metres were handed over, which is twice as much as the volume of handovers in the same period last year. The annual rate of expanse in supply is going to be higher than it was last year. About 101 thousand square metres of developments are expected to be completed until the end of the year, which indicates a 40% growth in comparison with last year. Since the empty areas are becoming scarce, developers’ activity is expected to be on the increase, while supply is going to exceed two million square metres.

The biggest volume construction works are taking place in the western suburbia, in Inpark Páty. The 23 thousand square metre investment is carried out by NIPÜF Zrt., which is owned by the state but is an active market player. The company focuses on developing properties in accordance with domestic and international clients’ demands.

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Office market report Q3 2017

ESTON International hereby reports The Budapest Research Forum’s Q3 2017 office market summary.

Two new office buildings were completed in Q3 2017; Graphisoft Park Start-up building was handed over on 2,500 sq m in North Buda, while Nexon’s 4,000 sq m owner occupied headquarter was handed over on the Váci Corridor submarket. The total Budapest office stock totalled 3,353,235 sq m. The total stock comprises 2,684,655 sq m of Category ‘A’ and ‘B’ speculative, and 668,580 sq m of owner occupied buildings.

Vacancy rate has continued to decrease by 1.0 pps quarter-on-quarter to 7.6%, which is the lowest rate ever on record. The lowest vacancy rate is still recorded on the South Buda submarket (3.3%), whilst the Periphery submarket registered again the highest figure (28.5%).

Demand in Q3 2017 increased by 67% compared to the previous quarter, comprising 164,985 sq m. Owner occupation deals represented the highest share of the demand in the third quarter with 32.7% share, followed by new deals with 27.6%. Renewals equated 24.8%, while expansions accounted for 6.4%. Share of pre-lease agreements represented 8.3% of the total leasing activity.

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