Local: X:\Documents and Settings\swindell\My

Kraków Office Market - April 2013
Limited immediate availability
will strengthen the pre-let activity.
Q1 2013
Y-o-Y change
Gross Take-up* (m2)
25,300
-4,800

20,700
-3,800

23,300
-22,400
Vacancy Rate (%)
4.2
-4.7 p.p



Completions (m2)
1,800
-19,000
Under construction (m2)
Prime Rent
(€ / m2 / month)
96,700
+40,900
13.5-14.5
0%
Net Take-up
(m2)
Vacancy (m2)
Kraków is one of the fastest growing office markets. The total
modern office stock in Kraków is estimated at approximately
551,400 m2, second only to Warsaw.
At the end of Q1 2013 almost 97,000 m2 of modern office stock
was under construction in the city, however only 32,100 m2
(20% secured with pre-lets) will enter the market in Q2-Q4 2013.
The low volume of new office space may cause a gap in supply
and a lack of immediate available office space on the market
resulting in decreasing vacancy rate; currently 4.2% (Q1 2013).
In Q1 2013, more than 25,300 m2 was leased, which accounts for
almost 30% of the total demand registered in major cities in
Poland (excluding Warsaw). It is worth noting that almost
20,700 m2 of deals in Kraków were transactions for new office
space. Major new deals signed in Q1 2013 included: Brown
Brothers Harriman (a pre-let of 4,700 m2 in Orange Office ParkAmsterdam), Google (expansion and renewal of 3,650 m2 in
office building at Rynek 12/13), Pekao SA (new deal for 2,900 m2
in Komputer Bit), Tauron Dystrybucja (new deal for 2,900 m2 in
Mix Jasnogórska) and UBS (new deal for 2,750 m2 in Green
Office C). In Q2-Q4 2013 we expect an increased number of
pre-let agreements.
Kraków is recognised worldwide as an excellent BPO / SSC
location thanks to a combination of factors, such as; excellent
scores in international rankings, talented labour pool and support
from institutions helping the sector, both in Poland generally and
in Kraków specifically.
Due to expected limited new supply and forecasted stable
demand in 2013, the vacancy rate should drop further. Large
tenants will have to sign pre-let agreements in developments
under construction in order to secure space as currently city
offers only two units over 2,000 m 2 in existing office buildings.
In 2013, the market will witness a transition from balanced to
more landlord favourable. Based on today’s market, the situation
may change in 2014 due to the expected high volume of pipeline
supply (around 103,500 m2).
Currently, prime headline rents in the best locations have
stabilized and vary from €13.5 to €14.5 / m2/ month. Due to the
relatively small pipeline supply scheduled for completion in 2013
and a forecasted drop in vacancy rate, we expect a slight
increase in effective rents in Q2-Q4 2013.
12 Month
Outlook
Summary Statistics







* Gross Take-up = Net Take-up including registered renewals
Stock (m2) and Vacancy Rate (%) Comparison, Q1 2013
Supply (LHS)
600 000
Vacancy Rate (RHS)
19.7%
20%
16.7%
500 000
15%
13.7%
400 000
11.7%
300 000
10.0%
9.7%
10%
200 000
2.6%
4.2%
100 000
0
5%
0%
Kraków Wrocław Tri-City Katowice Poznań
Łódź Szczecin Lublin
Gross Take-up (m2) and Vacancy Rate (%) in Kraków
Net Take-up
Renewals
Vacancy rate (RHS)
120 000
14%
100 000
12%
10%
80 000
8%
60 000
6%
40 000
4%
20 000
2%
0
0%
2008
2009
2010
2011
2012
Q1 2013
Prime Headline Rents (€ / m2 / month) Comparison
Poznań
Wrocław
Kraków
Tri-City
Katowice
Szczecin
Łódź
Lublin
10
11
12
Source all charts: Jones Lang LaSalle
13
14
15
16
17
Pulse  Kraków Office Market  April 2013
Jones Lang LaSalle Contacts
Anna Kot
Head of Office Agency & Tenant Representation
Warsaw, Poland
+48 (0) 22 318 0039
[email protected]
Rafał Oprocha
Head of Kraków & Katowice Office
Kraków, Poland
+48 (0) 12 294 9430
[email protected]
Agnieszka Sosnowska
Research Analyst
Warsaw, Poland
+48 (0) 22 318 0056
[email protected]
COPYRIGHT © JONES LANG LASALLE IP, INC. 2013. All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means without prior written consent of
Jones Lang LaSalle. It is based on material that we believe to be reliable. Whilst every effort has been made to ensure its accuracy, we cannot offer any warranty that it contains no factual errors. We
would like to be told of any such errors in order to correct them.