Mid-Year 2004

Mid-Year
Report
Introduction
The Prague Research Forum is pleased to publish the finalised figures for
mid-year 2004. The Prague Research Forum has been established by Jones
Lang LaSalle, CB Richard Ellis , Colliers International, Cushman & Wakefield
Healey & Baker and DTZ Zadelhoff Tie Leung to share the information
about the Prague office market and thus provide more accurate data.
Office Supply/Stock
In Q2 2004 Prague’s modern office stock1 reached 1,535,000 sq m.
Approximately 61% (ca. 927,000 sq m) is new build, whilst the remaining 39% (ca. 608,000 sq m) is made up of refurbished buildings.
Office Supply
Five modern office buildings were completed in the 2nd quarter of 2004,
adding approximately 60,000 sq m to Prague’s modern office stock.
Altogether 63,000 sq m of modern office space was completed in the
first half of the year 2004. Of this new supply 15% was completed in
the CBD, 64% in Mid Town and 21% in Out of Town locations.
1
Modern Office Stock is defined as buildings that have been completed after 1993, or have undergone a significant refurbishment since then. The modern office stock includes only class A and B
buildings.
2004
Prague Office Completions in Q2 2004
Quarter Building
Total Office Space (sq m) Submarket District
2
Jungmannova Plaza
9,480
CBD
1
2
Lighthouse A
16,194
MT
7
2
Empiria - 3rd phase
12,434
MT
4
2
The Park - 2nd phase (Buildings 1 and 3)
13,000
OT
4
2
City Point
8,550
MT
4
TOTAL
59,658
Office Take-up
Office take-up during the 2nd
quarter of 2004 was approximately 22,800 sq m, therefore
increasing the total for the first
half of 2004 to 59,000 sq m. In
comparison to the first half of
the previous year we can see
a decrease in take-up of 33%.
Total take up by district and Quarter
2
In excess of 72% of the space
leased in the first half of this year
was at new build projects.
With regards to business sectors,
the highest take-up was recorded
in Q2 in the Manufacturing sector
(mainly due to Siemens and Fiat),
followed by the Finance/ Professional services sector. (Accenture
and TPA Notia)
Thousand sqm
25
20
15
10
5
0
1
2
3
4
5
6
7
8
9
10
Q2
Q1
Prague Office Take-up by Sector Q1–Q2 2004
Banking/Insurance
Finance/Prof. Services
Other
Consumer Goods
IT
Adv/Media
Manufacturing
Pharmaceutical
Legal
0
2
4
6
8
10
Take-up (Thousand sqm)
12
14
Q1
2
Take-up is specified as all office leasing/sales transactions that were completed for
space in buildings within the modern office
stock. It also includes renegotiations and
pre-leases/pre-sales for owner occupation.
PRAGUE RESEARCH FORUM
16
18
20
Q2
2004
Take-up
Prague Take-up in Q1–Q2 2004
25
Thousand sqm
The most significant take-up
deals in Q2 2004 were Siemens
(2,282 sq m) at Technopark in
Prague 5, Central Group (1,500
sq m) at City Empiria in Prague
4, Fiat (1,496 sq m) at Danube
House in Prague 8, TPA Notia
(1,271 sq m) at Mánesova 28 in
Prague 2, Accenture (1,146 sq m)
at Office Park Nove Butovice - Bld.
A in Prague 5 and Hewlett Packard (1,075 sq m) at BB Centrum C
in Prague 4.
The average leasing deal in Prague
in 2003 reached 1,172 sq m. In the
first half of this year it dropped to
519 sq m. This major decrease was
primarily caused by the absence
of larger deals.
20
15
10
5
0
CBD
EC
MT
New Build
OT
Refurbished
Rents
70
16
60
15
50
14
40
13
30
12
20
11
10
0
10
Q1
Take-up
Q2
Additional Supply
Vacancy
Overall Vacancy (%)
Thousand sqm
Prague Office Market – 2004
Rents remained relatively stable
throughout Q1–Q2 2004, with
prime rents in the range of EUR
18.00–20.00 per sq m per month.
Outside the city centre prime
rents vary between EUR 14.50–
15.50 per sq m per month in the
established office sub-markets
such as Pankrác, Smíchov and
Karlín and EUR 13.00–14.50 per sq
m per month in established Out
of Town locations such as Nové
Butovice and Chodov.
The prime rent s described
above are the current headline
rents achievable for the best
modern (Class A) space. The
range for Class B buildings is
approximately 20% to 25% lower
than Class A prime rents.
2004 MID-YEAR REPORT
2004
Office Vacancy
The high amount of new stock, which
was not counter balanced by a rise in
demand, resulted in increased levels
of vacancy in Q2 2004. The rate in
the whole city rose from 12.9% in Q1
to 13.8% at the end of Q2.
The current vacancy rate is 12.9% for
new build space and 15.3% for refurbished buildings. The highest vacancy
is currently in the Mid Town submarket, primarily due to the completion
of a large new project in Prague 7.
The Central
Business
District (CBD)
Edge of Centre
Mid-Town
Out of Town
Submarket
Office Stock
(sq m)
Vacancy
Q1 Take-up
(sq m)
Q2 Take-up
(sq m)
CBD
393,350
15.7%
6,008
4,193
Edge of Centre
290,848
15.2%
4,400
5,548
Mid Town
435,897
18.7%
19,915
4,786
Out of Town
415,147
6.0%
5,993
8,295
1,535,242
13.8%
36,316
22,822
TOTAL
CB Richard Ellis
Cushman & Wakefield Healey & Baker
Richard Curran, Cory Hrnčiřík
Praha City Center
Klimentská 46, 110 02 Prague 1
Tel: +420 224 814 060
www.cbreczech.cz
Andrew Thompson,
Karel Zeman
Na Příkopě 1, 110 00 Prague 1
Tel: +420 234 603 603
www.cushmanwakefield.com
Colliers International
DTZ Zadelhoff Tie Leung
Peter Chatfield,
Simona Straková
Na Příkopě 859/22, 110 00 Prague 1
Tel: +420 221 451 518
www.colliers.cz
Guy Speir, Petra Papežová
IBC Building
Pobřežní 3, 186 00 Prague 8
Tel: +420 222 322 013
www.dtz.com
Jones Lang LaSalle
Lukáš Schirl, David Tůma
Myslbek
Na Příkopě 19, 117 19 Prague 1
Tel: +420 224 234 809
www.joneslanglasalle.com
PRAGUE RESEARCH FORUM REPORT