The modern office stock in the main regional cities throughout Romania went up by approximately 20 percent in 2015 y-o-y, according to a DTZ Echinox report. At the end of 2015, class A & B office space in Cluj Napoca, Timisoara, Iasi and Brasov, the main regional office markets, reached 584,000 sqm. New supply exceeded 90,000 sqm and compared with 2014, it was two times higher. Almost half was delivered in Cluj Napoca (47 percent). The remaining was equally divided between Timisoara and Iasi. The largest office project completed in 2015 outside Bucharest was the second development phase of The Office in Cluj-Napoca, which has a rentable area of 18,000 sqm.
In the first half of 2016, the level of new office supply in the main regional cities amounted to 47,500 sqm which has increased the total modern office stock outside the capital to approximately 632,000 sqm. By the end of the year, another 39,000 sqm are expected to be delivered. “Going forward and analyzing the pipeline for H2 2016 – 2017, approximately 165,000 sqm of office space are scheduled for completion, with Cluj Napoca and Timisoara accounting 80 percent. At the end of 2017, the modern office stock in the main regional cities might reach approximately 800,000 sqm,” reads the report.
Throughout 2015 the gross office space take-up in the main regional cities throughout Romania amounted to approximately 70,000 sqm, which was up by 25 percent against 2014. The net take-up represented 90 percent, meaning approximately 60,000 sqm which was divided between new demand for office space (80 percent) and relocations within other A & B office buildings. An important trend last year was that pre-lease activity went up significantly, say representatives of the real estate services firm. Compared with 2014, the office area subject to pre-lease transactions in 2015 was three times higher and amounted 25,500 sqm. Also, the largest deal concluded outside Bucharest last year was a pre-lease transaction.
Compared with the previous year, in 2015 demand for office space outside Bucharest was more fairly divided between markets, say DTZ representatives. From the total office area transacted, Iasi accounted for 35 percent. It was followed by Cluj Napoca – 23 percent, Timisoara – 22 percent and Brasov with 20 percent. Technology & telecommunication companies continued to be the best performing office occupiers, with 75 percent of gross take-up, followed by financial companies, with 10 percent and manufacturing / industrial with 8 percent. In H1 2016, gross take-up in the main regional cities has nearly equaled last year’s results. Given the strong level of transactional activity, office demand outside Bucharest is projected to reach in 2016 the highest figure ever recorded, forecast DTZ Echinox representatives.
|CITY||Office stock H1 2016 (sqm)||New supply H2 2016 & 2017 (sqm)||Headline rents A class* (EUR/sqm/month)||Headline rents B class* (EUR/ sqm/month)||Service charge* (EUR/sqm/ month)||Vacancy rate class A (%)*||Vacancy rate class B (%)*|
|Cluj Napoca||240,000||65,000||13 – 15||8 – 11||2 – 3||4||7|
|Timisoara||126,000||66,000||12 – 14||9 – 11||2 – 3.5||< 2%||4|
|Iasi||180,000||10,000||12 – 14||8 – 10||2 – 3.5||6||9|
|Brasov||87,000||22,000||11 – 12||7 – 9||2.5 – 3.5||5||9|
Cluj Napoca remains the second largest office market outside Bucharest
There were 240,000 sqm of class A & B office space in Cluj Napoca at the end of H1 2016, according to DTZ data. This makes it the second largest office market in Romania, after Bucharest. Last year’s new supply stood at 43,000 sqm, this being the highest level recorded for a regional market. In terms of demand, last year’s net take-up totaled 16,000 sqm. At the end of H1 2016, the general office vacancy rate was of about 5 percent.
Between the second half of 2016 and 2017 approximately 65,000 sqm of office space are scheduled for completion. At the end of 2017, class A & B office stock in Cluj Napoca might exceed 300,000 sqm, forecast DTZ Echinox representatives.
At the end of H1 2016 the modern office stock in Iasi amounted to 180,000 sqm. Compared with other cities in Romania, Iasi is the third largest office market, after Bucharest and Cluj Napoca. Last year five office buildings were delivered, having a total GLA of approximately 25,000 sqm. Only 10,000 sqm are planned for completion through to 2017. In 2015 the gross take-up amounted 23,000 sqm. Net take-up represented more than 90 percent, with approximately 21,000 sqm transacted and was divided between new demand and relocations from old stock to class A & B office space
The western city of Timisoara has the fourth largest regional office market in the country after Bucharest, Cluj Napoca and Iasi. At the end of H1 2016, class A & B office stock in Timisoara amounted 126,000 sqm. Between the second half of 2016 and 2017 approximately 66,000 sqm of office space are scheduled for completion. At the end of 2017, class A & B office stock in Timisoara might be higher by 50 percent compared with H1 2016, forecasts DTZ Echinox.
At the end of H1 2016, the modern office stock in Brasov amounted to 87,000 sqm. The city has the fifth largest office market in the country. In 2015 no major office projects have been completed. Thus, the modern office stock in Brasov remained unchanged throughout the year. Between H2 2016 and 2017 the level of new supply in Brasov is scheduled reach 22,000 sqm and by the end of 2017, the office stock in Brasov could exceed 105,000 sqm, says DTZ.