Deal done! Our team has once again committed to walking 10.8 million steps for a worthy cause. And guess what? We surpassed our goal and together we walked an incredible 13,005,379 steps during the month of June!
With the cost of fitting out new offices doubling or even tripling, tenants are reluctant to move. Back in 2019, investing in office refits cost in the region of EUR 400–600 per square metre, but since then the price has spiralled to some EUR 1,000, with costs upwards of EUR 1,200 no exception either. These costs, combined with the rising expense of renting and running offices, are among the principal reasons behind the cooling office market in the first half of this year. Many businesses are opting to stay put for the time being. This partly explains why there has been an upswing in the share of older leases being renegotiated, which rose to 45% in the first quarter.
Skyrocketing energy and operating costs, improved cash flow, less accessible credit, partially higher efficiency of production or business activities... These are the main reasons why some owners of industrial premises or buildings have decided to sell them to investors. They then stay in the properties as tenants or gradually look for other premises. This is according to data from the real estate consultancy 108 AGENCY, which specialises in this form of sale and subsequent lease, known as Sale & Leaseback. The transactions and enquiries made indicate that isolated cases two years ago have grown to dozens in recent months.
The supply of coworking spaces has grown to more than 50,000 sqm in Prague alone, complemented by another 58,000 sqm of serviced offices. Due to the growth of this concept in other regional cities, the real estate consulting company 108 AGENCY decided to launch a clear and intuitive Desking.cz - the first coworking comparison engine in the Czech Republic.
The real estate investment market is impacted by increased inflation expectations, higher interest rates and the inflated cost of financing, and this will continue into 2023. This inevitably leads to increasing yield expectations. In most European markets, across various sectors, yields have increased this year. According to BNP Paribas Real Estate, some price corrections are still expected in some markets and asset types in 2023. The market is expected to stabilise in the second half of the year, when investment activity could also see some revival. Currently, most markets are in the stage of ‘price discovery’. Since the summer, we have been witnessing a ‘dance floor situation’ on the Czech real estate investment market. Buyers are sitting on one side of the dance floor and sellers on the other, and everyone is waiting to see who will dare to enter the dance floor first. CPI inflation could reach 15.8% this year according to forecasts from the Czech National Bank, and inflation could be double digit in the first half of 2023 at the very least.
Season's Greetings To All Our Business Partners and Friends!
On November 23, a conference on Sustainability and revitalization of buildings organized by the Real Estate Academy in cooperation with the Finnish Embassy took place in Dům Radost in Prague 3.
108 AGENCY is moving to new offices. From 1 December 2022, we will be based in the office part of the PALLADIUM building at Na Poříčí 1079/3a in Prague.
The SKLAD association (Association of Competent Logistics Providers and Suppliers), of which 108 AGENCY is a member, has prepared a unique survey that reveals the trends and influences shaping the Czech logistics market. The result is a unique study that builds on the successful 2020 version.
