The rental of office spaces in Madrid increased 33% last year

23/01/2014 – Expansion

Renting offices in Madrid has increased 33% in 2013 compared with 2012, from 297.316 squares meters to 395.181, according to the study by the consultant Newman Aguirre.

In the study- of the office market in Madrid and Barcelona- this ‘good behavior’ is attributed to the increase of big volume transactions, and it is referred to those of Vodafone and Iberia made in the first quarterly and the one of Cepsa in the last quarterly.

In the analysis, it is informed that the promotional activity will continue being low and it is recalled that in 2013 only 56.359 square meters were incorporated to the Spanish office market.

The increase of offices’ stock in Madrid in the last year was of 0,4% up to 12.688.733 square meters. The Aguirre Newman forecast for 2014 is that other 71.406 square meters will be incorporated.

Concurrently, the emptiness of spaces will continue being the main problem: it is now of 14,1% that means that there are more than 1.792.000 square meters available.

Rent prices

It is highlighted as a positive datum that in 2013 the average prices of rent in the so-called business district have increased 0,5% after having accumulated 10 semesters of drop.

This price is at 29 Euros per square meter a month in the ‘prime’ zone, whereas in the zones ‘rc-rest of the city’ and ‘dc-decentralized’ the adjustment of average prices has been calculated at around 6%. In the zone ‘out-outside the city’ the decline was 13,4% annual.

For the following months, Aguirre Newman forecasts a good behavior with an improvement more than 7% and that the rent prices will be stabilized in the central zones, they will be raised for the most representative buildings and they will be adjusted for the zones far from the center.

As for Barcelona, in the last semester of 2013 the average incomes grew for the first time since the beginning of the crisis in 2008 1,1% in the business district (up to 14,5 Euros per square meter).

In the decentralized zones and those far from the city there was a tendency to adjust, up to 7,10 Euros per square meter a month. The offices stock in 2013 increased 0,8% up to 5.914.269 square meters, of which 41,1% were in peripheral zones. The forecast for 2014 is that the stock will be increased with 24.000 square meters.

Drop in surface

The gross contracting fell 3% last year, up to 197.601 square meters and it points out the average surface contracted, from 537 square meters to 509.

The vacancy rates increased up to 888.775 square meters, from which 58.743 were in the last twelve months and the majority is in peripheral zones.

The forecast of Aguirre for the following months is that the gross contracting in Barcelona will be increased to 225.000 square meters. The rental prices in the best zones will be stabilized and to all the rest will be adjusted.

As for the investment market of offices, in 2013 a high activity was shown: from 13 sold properties in one year to 38 in 26 transactions.

Investment

In 2013 transactions of investment were made valued at 800 million Euros, 66% in Madrid and 34% in Barcelona which means an increase of 66% in Madrid compared to 2012 and 49% compared to 2011.

The average volume of investment transaction was of 30 million and the foreign investment funds obtained 65% of the total investment vs. 5% of 2012.The private national investor acquired 35% of the investment and 50% of the transactions.

The seller’s profile was national (75% of the total incomes) emphasizing to the disposals of Public Administration and the financial entities.

Aguirre Newman forecasts that the investment offered will be increased as consequence of sale processes from the financial entities as a non-residential product and of the asset rotation from the foreign institutional investors.

 

Source: Expansión

59