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Here is the Q2 2016 Budapest Office Market Analysis

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Aug 5th, 2016
The Budapest Research Forum (BRF, which comprises: CBRE, Colliers International, Cushman & Wakefield, Eston International, JLL and Robertson Hungary) reports its Q2 2016 office property market snapshot.

The total office stock is 3,297,360 sq m in Budapest!

One new office complex was delivered to the office property market in the latest three months of 2016 extending to 5,700 sq m in the CBD. One office building (3,490 sq m) One

scheme was excluded from the stock due to change in use The total modern office stock is currently 3,297,360 sq m which contains 2,632,780 sq m of Category ‘A’ and ‘B’ speculative, and 664,580 sq m of owner occupied buildings.

Growing demand

Demand reached 129,172 sq m of transacted office space, which was 53% higher than in Q1. Vacancy rate went on declining by 3.9 pps year-on-year and 1.0 pps quarter-on-quarter bottoming at 10.3%, which was the lowest level since the financial crises. The Non-

Central Buda South submarket continues to enjoy the lowest vacancy rate (5.8%), whereas the highest vacancy rate was measured in the Periphery region (31.2%). The vacancy rate of the Non-Central Pest submarket improved the most by 8.1 pps y-o-y standing at 7.9% at the end of Q2 2016.

Renewals and relettings generate average growth

No owner-occupied transaction was recorded in Q2, however, according to the analysis 202 lease agreements were signed in Q2 2016, with an average deal size of 639 sq m. The main driving forces of the office market were the renewals with a share of 51%. New deals came second with a ratio of 37%. Expansions accounted for 8%, whereas pre-leases for 4%.

The Váci Office Corridor still dominates

The Váci Office Corridor had the highest leasing activity, enjoying the highest share

of take-up with 38,870 sq m, 30.1% of all transactions were signed there; followed by Central Pest and Central Buda, with a share of 25.2% and 13.2% within the total leasing activity. BRF registered altogether 26 transactions above 1,000 sq m, 13 renewals, 11 new deals and 2 pre-leases. 9 of these contracts were signed in the Váci Corridor submarket, followed by Central Pest and Central Buda. Nordic Light had the largest pre-lease transaction (2,100 sq m), whereas the largest new lease agreement was released by Haller Gardens with over 2,000 sq m. Net absorption totalled 36,526 sq m in Q2 2016, 24.7% higher than in Q1. Market shares of Central are excessively high (14,933 sq m).

(Source: http://realista.hu) 

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