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Real Estate: Transactions of office space in Bucharest could reach highest level in past five years
Total transactions with office space in the Capital is estimated to reach 240,000 to 260,000 square meters by the end of 2013, the highest level in five years, according to a report of CBRE company.
Compared with 2012, the increase is 10 percent, according to the report on office space in Bucharest in Q2 2013.
Total trading activity recorded in the second quarter of 2013, in Bucharest, involved 68,800 square meters, an increase of 13 percent from the previous quarter. Modern office space stock reached 2.23 million square meters. By the end of the year, 55,800 square meters are to be delivered, consisting of three new office buildings, plus another 30,500 sqm, due to two conversions.
'For 2014 there are in construction just 48,700 sqm, which would be the lowest level of deliveries from 2000 to present. Also, some other 25,100 sqm under construction are due for delivery in the first quarter of 2015, the most notable being the first phase of Green Court Bucharest, developed by Skanska. From the total area of office buildings under construction, 30 percent is in the west of the Capital ', said Razvan Iorgu, CEO CBRE Romania.
Rentals in the second quarter totaled 43,000 sqm and included relocation (67 percent), extension (19 percent) and new demand (14 percent), with no pre-lease deals. Other 22,700 sqm consisted of contract renegotiations and renewals.
In Bucharest there are over 337,000 sqm of modern spaces available, representing 15.1 percent of the modern stock. The vacancy rate for Class A buildings is 12 percent, while Class B buildings face a vacancy rate of 17.3 percent.
The rent required is estimated at 18 euro / sqm / month, while the net rent, which includes all types of incentives offered by the owner to tenants can reach 92 percent - 94 percent of the rent required. For properties with a high vacancy rate, there is also a 15 percent difference between the required rent and the net one.