PRAGUE OFFICE MARKET HIGHLIGHTS: Q1 2022
- With only one new office building delivered to the Prague office market in the first three months of 2022, the city’s total modern office stock expanded to 3.75 million sq m.
- After 18 quarters, office vacancy rate again surpassed 8% and reached 8.4% (up by 60 bps q-o-q). This corresponded to 315,300 sq m of immediately vacant offices, which was the highest level of vacant space seen in Prague since Q4 2016.
- Total occupier activity in Q1 2022 reached 135,600 sq m, being the highest since the beginning of the Covid-19 pandemic and 44% above the gross take-up level recorded in Q1 2021.
- Q1 2022 net demand totalled 75,700 sq m, which was 70% up y-o-y and 32% higher than in the previous quarter.
- The market experienced positive absorption for the second quarter in a row, posting 1,500 sq m in Q1 2022.
- Active construction pipeline was slightly lower than a year ago and in March 2022 totalled 182,600 sq m.
- Average prime headline rents went up slightly from the previous quarter and in Q1 2022 stood between €24.00 and €24.50, while new developments in CBD indicate rents from €25.00 to €30.00 per sq m a month.
Pavel Novák, head of office agency, Savills CZ&SK, says: “In the first quarter we registered a positive progress within the Prague office market, which was reflected both in the number of enquiries in progress within our team and the volume of closed transactions within the citywide statistics, which reached pre-pandemic levels in the first quarter, with a year-on-year increase of 34%.”
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