IT companies now account for 60 percent of all deals in the Kyiv office rental market, according to the latest report by JLL, a commercial property and investment management firm.
“This is the best result in the history of the Kyiv office market,” Alexandra Globina, head of office group at JLL in Ukraine said. “As both local and international IT companies expand their presence in Kyiv, we expect that the IT sector will continue to be a major occupier of office space.”
However, despite growing demand, office development is still sluggish: the supply of new office space is three times lower this year that it was in the pre-crisis period of 2011 to 2013, Globina said.
Since the beginning of 2017, only 3,000 square meters of new office space has come online, all of it in a new section of the Forum West Side business center in Shevchenkivsky district.
However, another 42,600 square meters of new office space is expected to hit the Kyiv market by the end of the year, as the Astarta business complex and UNIT City innovation park complete their first and second stages. The total stock of office space in the capital currently amounts to 1.65 million square meters.
Growing demand and limited supply has pushed vacancy down to 16.3 percent. It was around 19.3 percent at the end of 2016.
“Vacancy has been going down over the last two years, but in 2016 it was mostly in grade A premises,” Globina said. “This year we see that there is less vacant space in grade B.”
Currently, the monthly average rate for grade A office premises is $16-28 per square meter and $9-17 for grade B.
JLL experts said they don’t foresee any fluctuations in prices.
