Gdynia Comes to Prominence as an Office Destination in Tricity
Tricity’s office stock increased by more than 6% year-on-year to 790,000 sqm at the end of the first quarter of 2019. The region’s vacancy rate fell by 2.3 pp compared with the end of March last year to the current 5.4%, its lowest in the last five years, according to “Occupier Economics: Office Market in Tricity in Q1 2019”, a report published by real estate advisory firm Cresa.
“Tricity is Poland’s leading market in terms of effectiveness in attracting new office tenants. Developers are increasing their activities in Gdynia, clearly benefiting tenants who have a wider choice of suitable locations within the whole metropolitan area. The market is seeing an increased demand for office space coming from the TFL sector (transport, forwarding and logistics), which is recording a double-digit growth in turnover following the expansion of the seaport industry,” says Michał Rafałowicz, Head for the Pomeranian Region, Cresa Poland.
Office take-up amounted to 9,100 sqm in the first quarter of 2019, representing just 11% of the annual five-year average. New leases accounted for 70% of the leasing volume, while renegotiations and expansions made up 25% and 5%, respectively. The three largest transactions included 3,000 sqm leased by BBK at BCB Business Park II, a 2,600 sqm lease renegotiation and expansion at Alchemia III Argon (confidential tenant) and 1,500 sqm leased by JUUL Labs Services in the same office building.
Two office projects were completed: Heweliusza 18 (10,000 sqm, Apollo-Rida) and Hiro (5,000 sqm, Hossa). Another 50,000 sqm is expected to come onto the market by the end of this year. Office absorption amounted to 19,000 sqm in the first three months of the year, up by 23% on the quarterly average for the years 2012-2018.
“Tricity is attracting new office projects, which is reflected in market data. More than 100,000 sqm of new office space is expected to be completed in the next four quarters alone,” says Bolesław Kołodziejczyk, PhD, Head of Research & Advisory, Cresa Poland.
Asking rents range between EUR 13.00–17.00/sqm/month in Tricity’s most recent Class A office projects with older Class A office buildings commanding EUR 11.00–13.00/sqm/month.