PROPERTY

Office rental rates prove resilient

office-rental-rates-prove-resilient

The office market has entered a period of adjustment amid the pandemic, while showing some remarkable resilience.

According to the latest report on the Athens office market by the Geoaxis Price Observatory, the certified property surveyor recorded that in the first few months of 2021, and “despite the pandemic, the course of office rentals is proving exceptionally resilient on an annual basis. On average, we have observed a small rise in asking rental rates on the main streets and in the city center of Athens amounting to 1%.”

Autonomous office blocks with parking spaces on Syngrou Avenue showed the biggest rate rise, of 1.63%, averaging at 9.35 euros per square meter on a monthly basis, against €9.2/sq.m. Mesogeion Avenue reached a €9.2/sq.m. rate this year, up 1% on a year earlier.

On Kifissias Avenue the mean rate stands at €10.82/sq.m., up 0.84% on last year, while Vouliagmenis Avenue office blocks have an average rental rate of €8.6/sq.m. per month.

In the center of Athens, there has been a 1.6% jump in rental rates for offices around Syntagma Square, with the average reaching €13.15/sq.m., from €12.95/sq.m. last year. Nearby Kolonaki has seen a 1.3% increase to €17.8/sq.m.

Geoaxis head Ioannis Xylas explains that “today the office market has three different speeds: Quality offices, virtually regardless of location, enjoy very high demand, with rents that may even be higher than €20/sq.m. and returns of around 6.5%, while older or unrenovated offices may fail to get a tenant even at €5/sq.m. in secondary locations in the center of the capital. Between these two extremes are the old offices on key streets that are showing remarkable resilience, at rates of €10/sq.m. and returns of around 7.5%.”

He adds that “these different speeds are expected to continue throughout 2021, as the real economy does not yet seem to be rebounding and helping small and medium-sized enterprises and freelance professionals to grow and absorb the stock of offices that are not high-standard.”