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News Release

Prague Research Forum Announces the Office Market Figures for Q1 2018


Introduction

The Prague Research Forum is pleased to announce the office market figures for the first quarter of 2018. The members of the Prague Research Forum – CBRE, Colliers International, Cushman & Wakefield, JLL, Knight Frank – share non-sensitive information with the aim of providing clients with consistent, accurate and transparent data about the Prague office market.

The RICS supports activities of the Prague Research Forum.

Office Supply/Stock

At the end of Q1 2018, the total modern office stock in Prague stood at 3,357,500 sq m. The ratio of A-class modern stock to
B-class modern stock was approximately 71%. Top quality AAA class properties accounted for 18% of the total office stock.

In Q1 2018, a total of 38,700 sq m of office space was delivered, including these buildings: Visionary (20,500 sq m) in Prague 7, City West A1 (9,300 sq m) in Prague 5, Nekázanka 11 (5,600 sq m) and Mango Building (3,300 sq m) in Prague 1.

There is currently ca. 334,200 sq m of office space under construction in Prague with scheduled completion between 2018 and 2019. In Q1 2018, five projects commenced construction, including these buildings: VN47 (14,100 sq m) in Prague 1, Rustonka R3 (11,300 sq m), Rustonka R4 (13,200 sq m), Praga Studios (10,600 sq m) and Praga Office&Garden (2,100 sq m), all in Prague 8.

Office Take-up

Gross take-up (including renegotiations and subleases) in the first quarter of 2018 amounted to 85,700 sq m, representing a decrease of 51% compared to the previous quarter and a decrease of 19% in year-on-year comparison.

The highest volume of gross take-up was recorded in Prague 1 (28.7%), Prague 4 (25.3%) and Prague 8 (18.8%).

IT companies accounted for the largest share of gross take-up (14.7%), followed by Professional services sector (13.2%) and Pharmaceutical companies (13.1%).

The total share of renegotiations in the first quarter accounted for 24% of gross take-up, which was the same level compared to previous quarter. New leases and pre-leases accounted for 62% of the total gross take-up.  

Significant Office Leasing Transactions

The largest non-confidential transactions of the first quarter of 2018 were the renegotiation and expansion of Albastros Media (3,100 sq m) in Na Pankráci 30 in Prague 4, followed by the pre-lease of HubHub (2,700 sq m) in Palác ARA in Prague 1 and the renegotiation of Fio banka (2,500 sq m) in Millennium in Prague 1.

Office Vacancy

In Q1 2018, the vacancy rate further decreased by 1.1 percentage points to 6.2% compared to the previous quarter. Total vacant space amounted to 207,300 sq m. The highest vacancy rates were recorded in Prague 3 (11.1%) and Prague 5 (7.7%). Conversely, the lowest vacancy rates were recorded in Prague 2 (3.6%), Prague 10 (3.9%) and Prague 8 (4.6%).

Rents 

Prime headline rents in the city center slightly increased compared to previous quarter and stood between 20.00 and 21.50 €/ sq m/ month. Prime headline rents in the inner city varied between 15.00 and 16.50 €/ sq m/ month and in the outer city between 13.50 and 15.00 €/ sq m/ month.