Occupier conditions improve in CEE capitals: JLL

Occupier conditions in the cities of Bucharest, Budapest, Prague and Warsaw are set to improve over 2010 as rents fall and vacancy rates increase, according to Jones Lang LaSalle's report 'Onshore, Nearshore, Offshore: Unsure? A 2010 Central European Perspective' published on Tuesday. The report outlines the attractiveness of CEE markets for landlords and tenants over the next three to four years.

Budapest's and Bucharest's real estate markets are expected to be particularly favourable towards tenants over 2010/2011, while conditions for both tenants and landlords are set to be more balanced in Warsaw and Prague by 2011, due to anticipated lower vacancy levels. In 2012, Jones Lang LaSalle predicts that conditions in all cities, with the exception of Warsaw, are to remain relatively balanced between landlord and tenant market conditions as the balance between supply and demand becomes more aligned. Warsaw, with its current single digit vacancy of 7.3%, will reach a landlord-favourable market sooner.

John Duckworth, managing director of Jones Lang LaSalle Central and Eastern Europe, commented: 'The CEE region, though impacted by the global recession, will continue to attract corporate investment. The region has a highly educated, skilled and multilingual labour pool and lower labour costs than Western Europe. Due to rising unemployment figures and stagnating salary levels the availability and cost of labour has improved. This, combined with real estate developers active in CEE who understand the constantly changing needs of occupiers, are providing modern, flexible, high-specification properties at highly competitive prices.'