Wrocław office market third biggest in Poland

The largest biggest buildings completed last year were Business Garden (36,600 sqm), Pegaz (18,500 sqm), Kaufland (built for the company’s own use and 16,000 sqm) and Nobilis Business House (14,800 sqm). The main projects under construction are Sagittarius Business House I and II (Echo Investment), Retro Office House (LC Corp), Green 2Day (Skanska Property Poland) and West Link (Echo Investment). 62,000 sqm of office space was constructed between the beginning of 2016 and the end of September and by the end of the year the volume should have exceeded 100,000 sqm.

“Wrocław is the third biggest office market in Poland, with Warsaw being the first and Kraków the second largest. The first modern office buildings, including Centrum Biurowe Globis, Grunwaldzki Center, Bema Plaza and West House, were built here around ten years ago and the market has grown impressively ever since,” says Katarzyna Krokosińska, manager at JLL office in Wrocław. As in other parts of Poland, both international developers, such as Skanska and Vastint, and Polish companies, such as Echo and LC Corp, are active on the Wrocław’s market. Local developers, such as Archicom and Vantage Development, are increasingly making their mark on the local commercial real estate market. In 9M 2016, the lease agreements signed in Wrocław amounted to 78,850 sqm – the third highest figure in Poland, with Warsaw and Kraków first and second, respectively. Similar to other bigger cities outside Warsaw, this dynamic growth of the office market would not have been possible without the business services sector. According to ABSL, 111 business service centres operate in Wrocław, with 34,200 employees. The launch of new brands and the development of companies already operating in the city are generating substantial demand for office space and new office locations. “The western part of the city, between the centre and the airport along ul. Legnicka and ul. Strzegomska, also continues to develop. It offers space for modern, multi-stage business parks. The Central Business District, situated on the edge of the Old Town and the southern part of the city, and which is around 330m from the main railway station and a 15 minute-walk from the Old Town Square, is also now under construction,” adds Katarzyna Krokosińska.

Vacant buildings and rents

At the end of Q3 2016, the amount of unleased office space amounted to 10.2 pct. It should be stressed, though, that finding a vacant office with an area of 2,000 – 3,000 sqm in short time (the average transaction volume in the last six months was 1,600 sqm), which meets all the criteria specified by demanding tenants, is not easy because of a still limited number of projects in offer. Many companies are undergoing consolidation and moving from older to newer buildings and from worse to better locations. The highest transactional monthly rents in Wrocław amount to EUR 14–14.5 per sqm, while medium level rents are EUR 12–13 per sqm. Wrocław offers attractive terms and incentive packages from property owners, especially when signing the preliminary lease agreement.