The Budapest office market enjoyed a dynamic year in terms of gross take-up, equating to nearly 535,000 sq m of office space transacted, effectively in line with the record year of 2015 which saw circa 538,000 sq m.
However, the annual net take-up (which excludes lease renewals) reached a record volume in 2018, with nearly 400,000 sq m of space being transacted, a significantly higher figure than 2015 which ‘only’ transacted circa 365,000 sq m. This strong net take-up was largely driven by a flurry of new leases within the existing office stock, equating to circa 230,000 sq m (circa 60%) of the net take-up across 350 transactions. Pre-leases in ongoing developments also stood for a notable share within the net take-up, at ca. 25% of the volume.
This high level of demand has not gone unnoticed by Developers, as the city now has circa 482,000 sq m of office space under construction, of which almost 50% is already pre-committed. As a result of the strong demand in the market, the average vacancy rate in Budapest has eroded to an all-time low of 7.3%, with further reductions expected over 2019.
David M Johnston MRICS Head of Advisory & Transactions CBRE Hungary said: ‘To be the first Agency to ever transact over 100,000 sq m in one year is a great honour to have achieved. I am extremely proud of the team for their strong 2018 performance and thank all our clients for the trust they placed in us. Activity in the Budapest office market is the strongest I have ever seen, and less any unexpected macro-economic changes the outlook for 2019 remains robust.’
Lóránt Kibédi Varga MRICS, Managing Director of CBRE Hungary added: ‘It is a great accomplishment for CBRE to be market leaders in the Budapest office market, and a real testament to the team for all their hard work throughout the year. CBRE Hungary has now grown to be the largest Real Estate consultancy in Hungary, and clearly this would not be possible without an excellent symbiosis between our top talent and our Clients.’