Office vacancy rate might descend to 14-15 percent in 2011, CBRE estimates

Vacancy rate reached a stable rate at around 17 percent in 2010, shows a CB Richard Ellis report. Considering a similar level of take-up activity in 2011 to that of 2010, plus the much lower level of new supply (around 135,000 sq m), the vacancy rate might descend to levels of 14-15 percent, continues the report. Prime rent should not register any major fluctuations in 2011, considering the overall activity in 2010.

In 2010, the investment turnover in 2010 reached EUR 327.3 million, an increase by almost 45 percent against the volume of last year, according to the same source. The second half of 2010 brought a diminished level of investment transaction compared to the first half (by 55 percent), but also included the first major office investment transaction in the past two years – Floreasca Business Park.

The majority of purchasers in 2010 were foreigners (almost 90 percent of concluded transactions were by companies coming from UK – 47 percent, Austria – 17 percent, Norway, Italy, Poland); the same can be found on the vendor’s side – 82 percent of sellers are foreigners.

The majority of investment was in the retail sector, which in 2010 accounted for more than 60 percent of total investment turnover through either shopping centers, retail parks or big boxes. Office represented the second most transactioned segment in 2010 with one major event, the sale of Floreasca Business Park by Portland Trust towards NEPI. The number and volume of institutional residential transactions was scarce, under 6 percent of total volume. No investment transactions were recorded for industrial, mixed-use or hotels in 2010. The investment market in 2010 was dominated by medium size transactions, with an average of transaction of EUR 23.4 million, with a total of 14 transactions.

CBRE, with an estimate of 35 – 40 employees, reported a total of 60,000 sqm transactioned last year and a 30.2 market share. This year, the local office of the international firm will add two new departments, that of property and project management.