Budapest Offices


More and more tenants enter the office market

Feb 2nd, 2016

Turnover is increasing on the office and industrial estate rental markets in Hungary with more new developments on the horizon.

Investors and tenants are becoming increasingly interested in office and logistics estates, but still the buzz is far volume from the housing market's. In the third quarter of 2015 contract extensions made up more than half of buyer demand.

Profitability of the capital's market is still bad compared to other parts of Europe therefore it is still hard to find a financial background for development projects. The situation is even worse on the market of retail properties – the demand exists, but there are very few new properties built, and even those are mostly only for pre-lease.

Considering the office market there are no new central areas, but the area of Váci road is still popular.

There are all together 186 thousand square meters of logistics properties in the capital and there is great demand for them too. In the third quarter more than half of the demand consisted of new tenants and the vacancy rate stands at 14.2%. Intensive demand will likely also be present in 2016, therefore it is more likely for real estate developers to start more new investment projects.

Meanwhile the utilization rate is constantly decreasing since the second half of 2013. In 2015 Q3 utilization was 12.3% which is the lowest since 2008.





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