PROPIN, which provides office-oriented investment consultancy services in the commercial real estate sector, has published the "Istanbul Office Market" report covering the fourth quarter of 2022. According to the report, the number of owners applying the exceptions in the Turkish Lira Protection Law and renting offices in dollars has increased. Those who rent their offices in Turkish Lira (TL) have increased the figures constantly. While the average rent per square meter in Class A office buildings in the Central Business District (CBD) increased to the level of 19,4 dollars, the vacancy rate in Class A office buildings decreased to 23,4 percent. . In 2022, transactions were carried out in 267 thousand square meters of office space, and leasing and corporate purchases were made in approximately 83 thousand square meters of office space.
PROPIN, which provides boutique services in the field of real estate, has an important position in the ecosystem. Concentrating its expertise on the office market, PROPIN regularly informs its followers with its reports and research. PROPIN publishes “office” focused reports quarterly every year. PROPIN's “Istanbul Office Market's Fourth Quarter 2022 Report” contains many data from office rents to leasable office supply in Istanbul.
Aydan Bozkurt: “The number of people who rent offices in dollars has increased”
PROPIN Founding Partner Aydan Bozkurt, in her evaluation of the report, emphasized that the office ecosystem in Istanbul spent 2022 as a “owners' market”. Bozkurt said that despite the economic fluctuations, a large number of rental transactions were made and said, “The supply of qualified office buildings has decreased significantly. There has been a remarkable increase in average rents due to the increase in demand and increasing inflation.
Noting that some companies that switched to the hybrid working model have reduced their office space and moved to offices designed according to the new working order, Aydan Bozkurt said, “In addition, companies that grew after the pandemic rented additional spaces in their existing buildings. This volatility in the market has caused the execution time of transactions to be shortened considerably compared to previous years.
Emphasizing that the owners of the offices, especially for Class A office spaces, have started to declare the list rent in US Dollars, Bozkurt said:
“The number of people renting offices with dollars has increased. The owners, who announced the list rental figures in Turkish Lira (TL), increased the figures continuously from month to month. The gap between the new rents demanded for buildings and the rents paid by existing users has clearly widened.”
Ebru Ersöz: “The average rent per square meter has reached the level of 19,4 dollars”
Ebru Ersöz, Founding Partner of PROPIN, said that the increase in the average office rent at the end of 2022 attracted attention due to the increasing demand for offices and inflation.
Pointing out that the average rent per square meter in Class A office buildings in the Central Business District (CBD) rose to $2022 by the end of 19,4, Ersöz shared the following information: “The global pandemic has changed working conditions. As a result of this, a general expectation prevailed in the market that offices would be vacant. Contrary to expectations, demand for Class A offices tended to rise throughout the year.”
Ersöz added that the number of users who want to benefit from our “Need-Specific Project Development Consultancy” service offered by PROPIN has increased.
The transaction took place in an office area of 267 thousand square meters.
According to PROPIN's Istanbul Office Market data for the Fourth Quarter of 2022, at the end of the fourth quarter of 2022, the vacancy rate for Class A office buildings in the CBD decreased to 23,4 percent, while this rate decreased to 14,8 percent in Out of CBD-Asia. . Despite the post-pandemic effects, an increase was observed in office rental and corporate purchase demand in 2022. In 2022, the transaction took place in an office area of 267 thousand square meters. In 2022, as a result of the continued demand for the CBD, approximately 83 thousand square meters of office space were leased and corporate purchases were made.
The report also included office rental trends in some districts on the Anatolian Side. Accordingly, it was observed that the existing stock in Kartal and Maltepe districts was generally in very high-rise buildings with small floor areas. Despite this, it has been observed that users prefer offices with large floor areas and high efficiency.
Class A office stock is predicted to be 2025 million square meters in 7,6.
According to the Istanbul Office Market report, the last three years have been stagnant in terms of office development. Despite the increase in office demand, no trend towards new office development was observed. On the other hand, it was stated that the contraction in office supply led large-scale office users to seek special projects on the land.
According to PROPIN's end-of-2022 calculations, it is predicted that the A-class office stock in the Istanbul Office Market will be approximately 2025 million square meters by the end of 7,6. An important part of this stock will be Istanbul Finance Center (IFC), the first phases of which are planned to be opened in 2023.
According to the report, the Istanbul Office Market, which turned in favor of office owners in 2022, will continue in this way for a while. While a general recession is expected in the election process, users who want to turn uncertainty into opportunity are expected to turn to new transactions.