According to the results of the first half of 2024, the vacancy rate in the office centers of the capital continues to grow with an actual decrease in rental rates, said head of the legal consulting department of UTG Kostiantyn Oliynyk. According to the UTG study, the average weighted vacancy in business centers of Kyiv according to the results of January-June in class A increased from 27.4% to 28.1%, in class B – from 20.2% to 21.8%, in class C – from 14.5% to 14.8%.
\n\u201cThere is a change in tenant formats, a reduction in occupied space, and a move\u00a0to\u00a0areas remote from the\u00a0center. The largest Ukrainian corporations have transferred employees from rented premises\u00a0to\u00a0their own administrative real estate. A number\u00a0of\u00a0companies have closed down their low-demand representative offices, and small and medium-sized ones are rationalizing their expenses. The practice\u00a0of\u00a0working from home has become widespread,\u201d Oliynyk listed the trends.
\nAt the same time, as of mid-2024, rental rates continue to decline. Thus, in class A, the average rate fell from $19.9\/sq m per month at the end of 2023 to $17.5\/sq m\/month in the second quarter of 2024. In class B, the decline was not so significant – from $11.8 to $11.5\/sq m\/month. In class C, the average rate rolled back from $9.7 to $9.1\/sq m\/month. \u201cGiven the rising cost of energy, the rise in utility bills (the need for generators, the loss of electricity\/working time due to alarms), and OPEX (due to the growth of vacancy and the distribution of operating payments to a smaller number of operators), the burden on tenants continues to increase, and rental rates show a further decrease,\u201d Oliynyk said.
\nLow market activity has caused a decrease in developer activity in the capital’s office real estate market. Currently, the volume\u00a0of\u00a0professional real estate\u00a0of\u00a0classes\u00a0A, B and C is 2.556 million sq m. At the same time, in the first half\u00a0of\u00a0the year, the supply expanded by only one project with a total area\u00a0of\u00a05,000 sq m at the intersection\u00a0of\u00a0Filatova Street and Saperne Field.<\/p>\n
More than 30 projects with a total area\u00a0of\u00a0about 800,000 sq m, whose opening was previously announced for 2024-2025, are most likely\u00a0to\u00a0be postponed,\u201d Oliynyk noted.
\nUTG was founded in 2001. It developed over 1,300 real estate concepts. Over the years, with the company’s participation, 4.7 million square meters\u00a0of\u00a0commercial space have been leased in Ukraine.<\/p>\n
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