Prime rents in Greece's office market stayed stable in the first quarter of the year, according to Cushman and Wakefield Proprius, which expects investment activity in the sector to pick up despite the Ukraine war and inflationary pressures.
In a report, Cushman and Wakefield Proprius said that landlords and tenants will be faced with the challenge of significantly increased inflation and rising construction costs.
“Material and staff shortages on construction sites might postpone the completion of office projects. Even if most companies will continue to offer their employees the right to remote working, the office is proving to be a crucial place for internal exchange and cooperation, developing corporate identification and culture, and promoting employee satisfaction,” the report said.
Occupier’s confidence has been reflected by the high absorption in Athens of 35,000 sqm, well above the quarterly average and 55% higher than the figure been registered in the first quarter of 2021 on the back of easing health restrictions and improving economic sentiment.
CBD and North East Athens are the most attractive sub-markets while the size of the leasing transactions has been increased and the average deal is now 750 sq. from 600 sqm of the 2021 average, the report said.
The majority of office lettings come from the public sector, consultancies, and technology sector, it added.
On the investment side, real estate investment company Prodea acquired prime development land along Kifisias Avenue, Marousi, and will develop two buildings of a total 17,000 sqm GLA prime office space. Additionally, ehret+klein, German investment company, entered the Greek market by acquiring a central 3,500 sqm office building along Stadiou street.