Gross realised demand in Prague at the end of the last quarter came to 137,700 sqm, which is the highest level so far this year. Even though the increase in the amount of new office space in Q3 was the lowest so far this year and no new construction has even begun, there is little concern about a lack of offices going forward. In the coming months, developers plan to start the speculative construction of app. 126,600 sqm of new space.

Only 18,200 sqm of new office space was added in three projects in Q3 2022, but the lowest addition rate this year is expected in Q4, when only around 11,500 sqm should be completed. Czech office stock market will thus reach 3.8 mln sqm this year.

The leasing market in Prague continued its positive development on through Q3. Not only was market activity, resulting in gross take-up of 137,700 sqm, the highest in 2022 so far, but it was also the highest result since Q4 2019. This was also the fourth time in a row that the take-up figure reached over 100,000 sqm. The year-on-year increase equals 38 pct in both gross and net take-up. The current gross take-up for the first three quarters was app. 395,000 sqm, with net take-up taking a 59 pct share of the total or app. 233,000 sqm.

Despite seeing a decent share of renegotiations, an unabated demand for new offices is clearly visible and was not negatively influenced by any of the currently discussed office reductions and footprint optimisations. The Czech real estate market is traditionally more conservative when it comes to following global trends.
Josef Stanko, a senior analyst at Colliers

With year-on-year inflation in the Czech Republic closing in on 20 pct each month, and European HICP exceeding 10 pct, a wave of budget recalculations for the years to come is to be expected. The current situation is widening the gap between the old and the new, but as we can see from the vacancy and pre-leasing situation, new projects are only at a slight disadvantage so far.

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