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Rent stability unaffected by new office construction records

Feb 12
According to CBRE Riga Office Marketview, last year marks the highest construction activity since 2009. In total, 7 office buildings were commissioned in 2019 adding to the office stock of ca. 53,400 sq m of modern office premises Business Garden Rīga, Akropole Offices and the final phase of and Henrihs (Jaunā Teika). Among new business centers of 2019 are Mežaparks Offices, Telegraph offices and Red Line offices.

Total stock has grown remarkably since 2018 and reached over 704,000 sq m at the end of 2019. The vacancy rate increased significantly to ca. 9%. Rent rates remain stable. Up to 50% of lease deals were sized from 300 sq m to 1,000 sq m, and one-third of lease transactions were for premises up to 200 sq m in 2019. The Latvian economy lost momentum, yet the growth remained above the 2% level. The forecasts remain firmly positive. Prime office yields stayed at a historic low at 6.25% over 2019.
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Zlata Elksnina-Zascirinska, Country Managing Partner at PricewaterhouseCoopers