Office Space Demand Surges 60%, 1,000 Sq. M Transactions Lead

The office market in Bucharest has shown a sustained demand growth in Q1, both in terms of the transacted volume and of the average lease size, amid an extremely limited new supply, according to data from the Cushman & Wakefield Echinox real estate consultancy company.

Companies leased 91,000 sq. m of office spaces in Bucharest in Q1, corresponding to a significant 63% y-o-y increase. A number of 55 transactions were concluded during the analyzed period, with an average deal size of 1,657 sq. m, twice the level of recorded in Q1 2023.

Transactions pertaining to areas of up to 1,000 sq. m accounted for the largest share (65% of the total), followed by those ranging between 1,000 – 2,000 sq. m (16%). Seven deals were signed for offices with an area between 2,000 – 5,000 sq. m, while three exceeded 5,000 sq. m.

The office market in Bucharest has shown a sustained demand growth in Q1, both in terms of the transacted volume and of the average lease size, amid an extremely limited new supply, according to data from the Cushman & Wakefield Echinox real estate consultancy company.

Companies leased 91,000 sq. m of office spaces in Bucharest in Q1, corresponding to a significant 63% y-o-y increase. A number of 55 transactions were concluded during the analyzed period, with an average deal size of 1,657 sq. m, twice the level of recorded in Q1 2023.

Transactions pertaining to areas of up to 1,000 sq. m accounted for the largest share (65% of the total), followed by those ranging between 1,000 – 2,000 sq. m (16%). Seven deals were signed for offices with an area between 2,000 – 5,000 sq. m, while three exceeded 5,000 sq. m.

The net take-up had a low share (38%) in the total activity, in line with the trend observed during the past 3 years, as the major tenants preferred to consolidate their operations and renew their contracts in the existing premises. The vacancy rate has slightly decreased to a level of 14.4%, from 14.8% in Q1 2023 and from 14.7% at the end of last year. This indicator is expected to compress going forward, mostly on the account of the very limited short and medium – term pipeline.

BPO companies were the most active in terms of the leased areas, accounting for 36% of the total, representing entirely renegotiations of existing contracts. IT&C firms contributed to nearly 21% of the total volume, both through the renewal of existing premises and through new lease or relocations.

There has been no significant movement in terms of rental levels in Bucharest at the beginning of 2024, with the prime headline rent in the CBD area remaining at €22.00/ sq. m/ month.

KEY UNDER CONSTRUCTION PIPELINE

PROPERTY SUBMARKET PROJECT SIZE (SQM) OWNER / DEVELOPER
Timpuri Noi Square II Center 50,000 Vastint
Promenada Offices Floreasca – Barbu Vacarescu 23,400 NEPI Rockcastle
AFI Loft Center – West 15,000 AFI Europe
BucharestCushman & Wakefield Echinoxdemandoffice spaceQ1real estatetransactions
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