OFFICE SPACES OVERVIEW Q1/2016, PRESENTED BY MBL|CBRE

OFFICE SPACES OVERVIEW Q1/2016, PRESENTED BY MBL|CBRE

The vacancy rate started 2016 with a new sharp decline and is already slightly above 12.3%. Continuing the trend from Q4 2015, this was mostly driven by Class A properties in the central parts of the city, where demand remains was high, while the new projects are still under construction.
 
Deliveries in Q1 were 13,400 sq m, represented by the office space in the multifunctional project San Stefano Plaza, as well as other small buildings in the midtown and suburban areas. The stock increased to 1.73 mln sq m. and is almost equally represented by Class A and Class B properties.
 
Unlike previous periods, when office space was shifting from frozen to space under construction, this quarter the frozen space slightly increased to 120,000 sq m. At the same time, space under construction continues its downtrend, reaching already only 156,000 sq m, which will have its implications on the market in the next couple of years.
 
The net absorption in Q1 2016 was 22,700 sq m, keeping the trend from the previous two quarters and making a much stronger start of the year than in 2015. Take-up was 25,000 sq m, dominated once again by BPO and IT companies.
 
Average asking rental rates for quality office space increased marginally, by around 1.5% compared to Q4 2015, mostly due Class A buildings in CBD and midtown, where average rates are between €12 - €14 per sq m.  The majority of available space however remains in suburban areas, where rents are on average slightly above €11 for Class A and €6.5 per sq m for Class B.
 
For further market highlights review MBL Office Spaces Sofia Overview Q1/2016:
http://www.mbl.bg/uploads/documents/projects/35/Office_Sofia_Q1_2016.pdf
 
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