Office real estate market in Minsk in 2021

Last year was quite an active year compared to 2020, but at the same time, there is no need to talk about any strongly positive trends. Rates are going down more and more, vacancy is growing, and the investment attractiveness of office real estate has completely fallen.

Office rent

  • Decrease in rental rates for premises in business centers of various quality classes ( -15%)
  • Growth of vacancy in Minsk business centers by 35% compared to the beginning of 2021 (growth by about 50 thousand sq. m.)
  • Significant decline in demand among IT tenants.
  • Relocation of many large companies due to the unstable economic and political situation in the country.
  • The unwillingness of tenants to make repairs at their own expense and, in general, now they rarely consider premises without basic finishing.
  • Gradual recovery in demand compared to 2020. However, today’s demand is still significantly inferior to the demand observed in 2019.

Sale of offices

A decrease in the volume of transactions of administrative premises by 32% compared to 2020 and by 63(!)% compared to a fairly stable 2019.

Decrease in the number of transactions of administrative premises by 16% and 45% compared to 2020 and 2019 respectively

The volume of investment in office commercial real estate also decreased significantly. In 2021, the total investment amounted to about $30 million, while in 2020 it was at the level of $60 million (most of it in the first half of 2020), and in 2019 — $70 million.

A significant decrease in the interest of investors in the purchase of office space/objects. Now potential investors are looking more towards retail real estate due to fewer risks and higher returns.

According to the consulting and analytics department of the group of companies «Your Capital».

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