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News Release

Prague

Record year for the Prague office market

Highest ever take-up in the history of the Prague modern office market


Prague, 24 March 2015 – In 2014, we recorded an overall recovery of the Prague office market, both on the developers and tenants sides. Six new projects and one refurbishment were completed in the last quarter alone,” says Jana Krajčíková, Research Analyst at JLL.

In total, 150,000 sqm of office space was completed throughout 2014 which represents the strongest annual supply in the last five years and a 3.5% increase in comparison to the ten-year average. Thanks to intensive construction activity in the last few quarters, the modern office stock in Prague surpassed the milestone of 3 million sqm at the end of 2014. This above-average construction activity is expected to continue in 2015 when more than 180,000 sqm of office stock is expected to be completed. The Prague office market is gradually returning to the pre-crisis levels when annual new supply ranged between 150,000 and 180,000 sqm.

“The outstanding new supply of office space in 2014 was however accompanied by strong take-up, which reached a record 332,800 sqm, i.e. the highest volume ever recorded in the history of Prague’s modern office market. The last quarter of 2014 was particularly strong with more than 111,000 sqm of transactions representing the highest gross take-up ever recorded in Prague in one quarter,” adds Jana Krajčíková.

“New take-up reached approximately 200,000 sqm which is the highest figure recorded in the last 3 years and at the same time an above-average result for the last decade. Leasing transactions such as Amazon taking ca. 5,800 sqm  in Blox in Prague 6 and MSD taking ca. 6,200 sqm in Riverview in Prague 5, confirm that Prague is still an attractive destination for big international corporations.” adds Jan Mechl, Head of Office Agency at JLL.

“We need to add however, that there was a large portion of pre-leases among the new leasing activity – there were 14 deals totalling 56,500 sqm of office space. This represents the second highest result in the last ten years. At the same time, we recorded an above-average number of large transactions over 4,000 sqm with a total of 54,000 sqm in six transactions. These exceptional transactions had a considerable impact on the record numbers of 2014. Outside of this activity, little changed on the market, which is the relatively high number of renegotiations reaching 39.5%,” closes Eduard Forejt, Business Development Director at JLL.