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ESG-compliant features and sustainability accreditation are increasingly the norm in real estate as an essential requirement from tenants and investors and as a regulatory expectation from the EU and national governments.
The recently completed 12,500 sqm Academia office redevelopment and renovation project by ConvergenCE and Europa Capital in Pest’ District V is expected to achieve its final Well “Platinum” and “Gold” accreditation this spring. Successful developers now need to meet staff demands along with the additional costs, says real estate editor Gary J. Morrell.
The office environment, its amenities and location are an intrinsic part of any project concept, design, and leasing strategy. This is in reaction to changing and ever more complex tenant and, in turn, staff demands. Sustainability accreditation from third-party organizations such as Breeam, Leed and Well have a range of requirements that are increasingly the norm for high-end developments and a basic expectation for tenants and staff.
It remains an open question when investment activity in Hungary and the CEE region will pick up after a subdued period due to concerns over the cost of finance, and the uncertain economic and geo-political environment, says real estate editor Gary J. Morrell. Another worry is how long yield corrections will continue.
The international freight and logistics service provider Transdanubia has signed a 24,000 sqm lease in the PT3 hall of HelloParks Páty. The new tenant is expected to take over the building by the end of 2024. The space will include classic high-rack storage elements, block storage and office functions.
The Budapest office pipeline is limited; builders are exercising caution, and new projects are not being initiated in an uncertain environment. Concerns include geopolitical issues, longer-term letting and demand, office working practices and the time spent in the office, rising development and construction costs, increasing maintenance and energy costs and more expensive debt finance. Despite this, ongoing projects are continuing.
ESG-compliant features and procedures in real estate are increasingly the norm. That is exemplified by accreditation to a recognized third-party sustainability system by high-end office and industrial developers being a fundamental market requirement from tenants and to meet regulatory expectations from the EU and national governments.