The Budapest office space market is experiencing growth, despite continued high vacancy levels.
With total space comprising 10.2 million square feet, Budapest’s commercial real estate market is the second largest in the Central Europe region, creeping up on front runner Warsaw, which currently boasts 13.1 million square feet.
The report by real estate services firm Cushman & Wakeman also highlighted projected growth in office space construction in Prague, which is expected to reach 9.8 million square feet by the end of the second quarter 2014.
Bratislava came fourth in the list, with just over half as much office space as Prague.
Vacancy levels in Budapest continue to be an issue however, with the highest level of unused space per square foot, at 19.9 per cent. This is still a significant drop from the second quarter of 2012, when it stood at 21.3 per cent.
Rental rates in Central Europe remain favourable when compared to averages in other areas. Monthly rent for Grade A space in Budapest averages at less than 10 euros per square foot, compared to London’s West End, where rents stand at around 40 euros per square foot. Rates in Warsaw average at around 12 euros per square foot.