Office market condition

In Katowice, the office space stock is currently estimated at level of approx. 220 000 sq. m* which locates the City as the fourth biggest office market among regional cities in Poland. The total stock will change in the nearest future following the completion of developments currently underway – Reinhold Center (Reinhold), Katowice Business Point (Ghelamco) and Francuska Office Center (GTC). But it is need to mention that the last one project is delayed and the construction is progressing very slowly. Investors continue to appreciate the potential of Katowice and consider the possibilities of further office developments, e.g. Hines, TriGranit, Skanska – the most advanced projects. However, most investors have now suspended construction and wait for an upturn in the economy. Recently, only two schemes (the next phase of the Euro-Centrum complex and the Havre Barbara building on Grabowa St.) were delivered onto the market.

Despite the relatively low supply level, the vacancy rate rose to nearly 7% in mid-2009* from it’s 1,8% level in 2008. However, the headline rental rates are stable and fall within the range of EUR 14-16 sq. m/month.

To some extent, greater availability is a positive, according to King Sturge. Increasing pressure on firms to cut costs may encourage further relocations to Poland from Western Europe.Such relocations tipically have a short lead in time and availability of accomodation is crucial to the process.

* C&W research