Regional Cities Office Snapshot 2021
Overview on the regional office hubs in Romania and the opportunities they can offer to tenants, developers and investors
- Alexandru David
As the conclusion of the COVID-19 pandemic seems to be in sight, or at least the most difficult part of it, office investments continue to be attractive, as approximately 80% of investment deals expected to be concluded in 2022 are with offices buildings. Regional markets can provide attractive alternatives, and also room for expansion and further growth in Romania.
In 2021 total property investment volume totaled €900 million, a value comparable to 2020. Prime office yields contracted over 2021, from 7% at the beginning of the year to 6.9% in Q3 and 6.75% in Q4.
The office letting market in Romania has greatly improved in 2021 when compared to the previous year, gross take-up increasing by over 37%.
Timisoara had the largest share in office leasing transaction in regional cities during 2021, with approximately 53,500 m². The second largest market in terms of office leasing was Iasi, with 43,300 m². Another 39,400 m² were leased in Cluj-Napoca, and 17,000 m² in Brasov.
Demand for office space in regional cities in 2021 was dominated by far by IT companies, especially in Cluj Napoca, Timisoara and Iasi.
Average net wages in regional cities are considerably lower when compared to Bucharest with Brasov being the most price competitive, while the average unemployment rates are significantly lower in the western part of Romania.