The share of vacant space in the office real estate segment in Kyiv at the end of 2018 was less 5%, and rental rates are growing, Head of the Capital Markets and Land Parcel Transactions Department of Cushman & Wakefield Volodymyr Mysak said at the Ukrainian Center of Steel Construction conference.
“In Ukraine, there is a very interesting comparison between supply and demand. Kyiv has the smallest number of square meters per 1,000 inhabitants in terms of office space among European cities. That is, there is a huge potential for increasing office space,” the expert said.
The company also believes that the investment attractiveness of office real estate is increasing. “If one has previously massively invested in residential real estate, now they are returning to office real estate. That is, many investors are returning to this,” Mysak said.
According to Cushman & Wakefield, by the end of 2018, the vacancy rate of commercial real estate in Kyiv amounted to 4.9%, the total offer was 649 square meters per 1,000 inhabitants. At the same time, rental rates averaged $29 per square meter a month.
According to Mysak, the vacancy rate is also very low in the warehouse real estate market – about 3%, which causes an increase in rental rates.
The expert said that the amount of investment in commercial real estate in 2018 was a record for 10 years.
“In 2018, there was a lot of investment in the economy of Ukraine, in particular in commercial real estate. We actually reached a 10-year peak – more than $300 million was invested in commercial real estate. This shifted the cycle from the point, and this means investors are confident that the market is moving in a positive direction.”