Prague outperforms London in DTZ office survey

Demand for offices was greater in Prague than in London in the first quarter of 2009, according to a survey of take-up in 16 European cities by property adviser DTZ.

The Q1 take-up in Prague reached 73% of the average quarterly take-up over the period 2005-2008, ranking the Czech capital third in the survey after Frankfurt and Budapest.. 'Of course, compared with the first three months of last year, which was a record year, this is a considerable decrease,' commented Martijn Kanters, head of Consulting & Research at DTZ. 'On the other hand, Prague and Central Europe have performed better than cities in Western Europe with the exception of Frankfurt.'

Take-up in Frankfurt reached 140,500 m² in the quarter, 11% more than the local average in 2005-2008. However, this figure is distorted by one transaction totalling 72,000 m². Budapest ranked second, reaching 91% of the four-year average in Q1 2009.

By contrast, the city of London hit its lowest level in 30 years in Q1 2009, while similarly big year-on-year drops were recorded in Moscow (90%), Dublin (79%) and Milan (74%).

DTZ said the relatively good results from CEE can be explained by the delayed impact of the economic crisis in the region, which will be reflected in the take-up results in the rest of the year. Occupiers in western Europe have been affected much earlier, the adviser noted.

The biggest drops in rent were registered in Kiev and Moscow, where a drop of demand was also connected to the devaluation of the currency. Luxembourg, Rome, Paris CBD and Budapest have been stable until now, DTZ said.