December 15, 2017

Leasing volume on the Tricity office market up by 60 percent

Leasing volume on the Tricity office market up by 60 percent

Tricity is the third largest regional city in Poland, after Krakow and Wrocław, in terms of office stock, now at 693,000 sqm. Absorption set a new high of 62,600 sqm of office space in the first three quarters of 2017, compared to the five-year average of less than 39,000 sqm, says global tenant-only real estate advisory firm Cresa in its latest report "Occupier Economics: Office Market in Tricity Q3 2017.

"Office tenants have finally come to fully appreciate Tricity's potential. Businesses are attracted to this agglomeration by a combination of factors including quality of life, further improvements to the Pomeranian Metropolitan Railway and a high number of students. Office complexes and buildings seeing strongest occupier interest include Alchemia, Olivia, Garnizon and Neptun," says Michał Rafałowicz, Head of Pomeranian Region at Cresa Poland.

62,500 sqm of office space has been added to Tricity's stock in the year to date, following the completion of six schemes, including the third phase of Alchemia (36,000 sqm), BCB Business Park - B2 (9,250 sqm) and Tensor Z (6,600 sqm). There is currently nearly 135,000 sqm under construction. The development pipeline comprises Tricity's tallest office building Olivia Star (approximately 40,000 sqm), which is nearing completion and is scheduled for delivery this December.

At the end of Q3 2017, there was 58,500 sqm of vacant office space, accounting for 8.4 percent of this region's total stock (a 3.6 p.p. decrease year-on-year). Office take-up to date has totalled 95,050 sqm, representing an almost 60 percent increase on that recorded in the same period last year. This year's largest new deals include Amazon's 7,100 sqm expansion at Olivia Business Centre and Swarovski's 6,100 sqm lease at Yoko, while the Energa Group has renewed its 15,100 sqm lease at Olivia Gate of the Olivia Business Centre.

"The expansion of Tricity's office market has helped bring down the region's unemployment rate to 3.2 percent. By the end of 2017, employment in the financial and business services sectors is likely to exceed 81,100. We expect more newcomers from the Baltic region, attracted to Tricity by a labour pool with Scandinavian languages capabilities and a high number of connections with the Nordic countries," says Bolesław Kołodziejczyk, PhD, Head of Research & Advisory, Cresa Poland.

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