CEE Office MarketBeat Reports

CEE-6 OFFICE MARKET Q4 2024

• Leasing activity remains robust in major capitals, with Warsaw leading at 740,200 sqm of take-up (down 1% year-on-year), Prague recording 636,700 sqm with large transactions driving Q4 activity, Bratislava posting the strongest relative performance with an 8% year-on-year increase to 198,700 sqm, and Bucharest achieving its third-highest historical total at 368,500 sqm despite a 20% decline.
  
  
• New development slows dramatically across all markets, with Prague adding just 72,800 sqm and projecting only 24,600 sqm for 2025—the lowest in the market's history, Warsaw seeing approximately 105,000 sqm delivered with a pipeline of 179,000 sqm falling well below historical averages, and Budapest's speculative pipeline dwindling to just 113,100 sqm through 2027.
  
  
• Prime rental rates show divergent trends with central locations outperforming, as Prague commands the region's highest rents at €30.00/sqm/month in the city center, followed by Warsaw (€22.00-26.00/sqm/month), Bucharest (€20.00-21.00/sqm/month), and Bratislava (€19.50/sqm/month), with ESG-compliant buildings commanding a significant premium across all markets.
  
  
• Hybrid work models reshape office demand patterns, with companies across the region typically requiring employees to be office-present 2-3 days per week, driving demand for higher-quality, amenity-rich environments that enhance collaboration despite more efficient space utilization patterns.
  
  
• Market bifurcation intensifies between prime and secondary assets, with modern Class A buildings in central locations achieving significantly higher occupancy and rental resilience, prompting landlords of older buildings to consider refurbishments to remain competitive in an increasingly quality-focused market environment.