The global pandemic of COVID-19 in 2020 had an impact on overall activity in the office market and delayed the completion of some projects. During 2020, slightly over 150,000 sq m was completed. Thanks to this, the total volume of modern offices climbed to 3.75 million sq m. Moreover, no new project was started during the last quarter of 2020, and in this respect, 2021 will be rather below average.

Due to the market situation, developers are changing their strategy in the construction of new projects, and to start their construction they aim to secure pre-leases, and speculative construction is now an exception. Office projects under construction now amount to approximately 140,000 sq m, of which approximately 98,000 sq m should be completed in 2021.

Although the vacancy rate remains stable at around 7.00%, the actual vacant office space is growing due to subleases. The total volume of unoccupied office space was 325,900 sq m. The share of subleases in the total unoccupied area is 19.70%.

Despite the above factors, rents were stable during 2020. At the end of 2020, the highest achieved rent was in the range of 22.00 – 22.50 EUR/sq m/month in the city center, 15.50 – 17.00 EUR/sq m/ month in the wider center of Prague, and 13.50 – 15 .00 EUR/sq m/month on the outskirts of Prague. However, these reported rent levels do not take into account the above-mentioned sub-leases, which are often offered below market conditions.

Average monthly rents

€ 15.5/sq m – € 17/sq m

Total stock

3,750,000 sq m

Vacancy rate

7.0 % [261,600 sq m]

Currently under construction

136,400 sq m

Yield "A" class

4.6 %

Yield "B" class

5.5 %