Poland experiences record demand in 2007

Poland's property market experienced record demand in 2007, according to a report released by DTZ. The 435,000 m² of take up on Warsaw’s office market was the highest ever recorded. Including renegotiations in the figure and overall take up was 491,500 m2, a 19% rise on the previous year. Strong demand has led to the increasing frequency of pre-lease deals, which accounted for 44% of leasing transactions on the office market. The majority of transactions took place outside the city centre. The low 3.1% vacancy rate is another record figure.

New office space added in 2007 totaled 211,500 m². While DTZ forecasts an additional 310,000 m² of office space to be delivered in 2008 strong demand will continue to keep modern space in short supply. Prime office space rents in central locations have reached EUR 30 / 33 per m² per month, with the market average being EUR 21 / 25.

Poland's retail market grew by 825,000 m² in 2007, an increase of 44% on 2006. While Warsaw dominates the office market only 11% of new retail was located in the capital. Secondary and tertiary cities received 41.4% of new space while large regional cities such as Wroclaw (18%) and Tricity (10%) accounted for the rest. The pipeline for 2008 / 2009 should be between 1 / 1.4 million m². Vacancy rates in successful centres remains between 0 – 2%.

Record demand also characterises the industrial sector, with take up of over 1.37 million m² in 2007. One million m² of new industrial space was delivered in 2007. The large number of new projects being delivered has caused a rise in vacancy to 8.9%. New locations are becoming increasingly significant for upcoming sector development.