Prague a big draw for prime office space | 20 September 2012
Prague is becoming one of the hot spots in Europe when it comes to prime office space.
A new report from Knight Frank has indicated that 76,000 square metres of new office space was created in the Czech capital during the first half of this year, with the majority being pre-let.
Almost half of this was delivered in the fast-developing Karlin area, which has been proved particularly attractive to foreign investors. Rents in these buildings have remained stable, at a monthly cost of 20 euros per square metre.
Stewart Thomson, who is head of investment and valuation at the Royal Institution of Chartered Surveyors (RICS), claimed that this has led to investors becoming less interested in secondary property.
He told property-magazine.eu: “There remains strong demand for prime office assets in Prague, particularly from international investors. However, a lack of available prime product has restricted recent transactional activity, as has the mis-match between the price expectations of vendors and buyers concerning secondary property.
“Pricing at the prime end of the market is holding firm, but buyers expect significant discounts for any assets which do not meet the increasingly narrow definition of time that we see in the current marketplace.”
Worldpropertychannel.com estimates that prime yields in Prague are currently averaging around six per cent.
Written by Joe Elvin on behalf of Qube Global Software
While posted by Qube Global Software all views expressed are not necessarily those of the company. All facts are verified where possible directly by the author.
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