C&W: The volume of new office space delivered will amount to about 78,000 sqm in Warsaw

The volume of new office space delivered will amount to around 78,000 sqm in Warsaw and around 229,000 sqm in regional cities in 2024, Cushman & Wakefield estimates.

"There is currently around 236,000 sqm under construction in Warsaw, compared to nearly 750,000 sqm at the beginning of 2020. Regional cities, on the other hand, have around 345,000 sqm under construction, compared to 850,000 sqm before the outbreak of the pandemic. We estimate that the Warsaw office market will only expand by around 78 thousand m2 this year, while the total new supply in the regions is likely to be 229 thousand m2," said market analyst Vitalii Arkhypenko.

At the end of Q4 2023, the total stock of modern office space in the office market in Poland (Warsaw and 8 regional markets) amounted to approximately 12.9 million m2. The total volume of projects delivered in 2023 was 47% lower compared to 2022. The largest amount of space was developed in Kraków and Wrocław, while Warsaw ranked 3rd in this respect.

"This confirms the continuation of the downward trend observed for the last three years in terms of the volume of space under construction, and despite a slight rebound due to the start of single office buildings, investors are still more cautious about launching new projects, which applies to both in the capital and regional cities," Ewa Derlatka-Chilewicz, head of the firm's research, commented.

The average vacancy rate in Poland at the end of 2023 was 14.1 per cent, up 0.1 percentage points from Q3 2023, and up 0.6 percentage points from the end of 2022. In the capital city, the vacancy rate fell by 0.2 p.p. compared to the previous quarter and amounted to 10.4%, while increases were recorded in the largest regional cities (Kraków, Wrocław, Tricity), Katowice and Łódź, on the other hand (cities with high vacancy rates), recorded a decrease in the vacancy rate in the region of 2 p.p. The average vacancy rate for regional cities was 17.5%. In all office markets included in the analysis, available space amounted to 1.82 million sq m, an increase of 6 per cent from the end of 2022, it was also reported.

Source: Cushman & Wakefield and ISBnews
Photo: Warsaw Spire