The year 2024 marked a period of stabilization in Warsaw’s office market, with growing supply concentrated in the city center and a high level of lease renegotiations. Despite slight year-over-year increases, the vacancy rate remained in a downward trend. In 2025, key factors shaping the market will include limited availability of large office spaces, the increasing importance of ESG standards, and the further expansion of flexible office formats. Poland’s largest advisory firm, AXI IMMO, has released its latest report summarizing the state of the Warsaw office market, “Warsaw Office Market in 2024.”
Stable Supply Focused on Central Locations
In 2024, Warsaw’s modern office space inventory grew by 100,000 sqm, reaching 6.29 million sqm by the end of December. Key developments completed during the year included:
- The Form (29,400 sqm, Lincoln Property)
- Lixa D and E (9,300 sqm and 16,900 sqm, Yareal)
- Saski Crescent (15,500 sqm, CA Immo)
- Vibe Phase 1 (15,000 sqm, Ghelamco).
Development activity remained concentrated in the city center, particularly around Rondo Daszyńskiego, which continues to be a focal point for developers. Notably, 83% of new supply in 2024 was delivered in central districts, reflecting the high demand for prestigious locations.
Emilia Trofimiuk, Research Manager at AXI IMMO, commented:
“Despite new projects, the total office space remains stable as older, less efficient buildings are being converted to other uses, primarily residential. Currently, 230,000 sqm of modern office space is under construction, 86% of which is in central Warsaw. Major ongoing projects include The Bridge (47,000 sqm, Ghelamco), Upper One (35,900 sqm, Strabag), V Tower (32,700 sqm, Cornerstone), Office House (27,800 sqm, Echo Investment), Studio A (26,600 sqm, Skanska), and Skyliner II (24,000 sqm, Karimpol).”
Vacancy Rates Decline Slightly
At the end of 2024, Warsaw’s vacancy rate stood at 10.6%, a minor increase of 0.2 percentage points year-over-year but still in a downward quarterly trend (-0.1 percentage points). The highest vacancy rates were recorded in the Służewiec district (19.7%), which faces an oversupply of older spaces. Meanwhile, central districts continued to maintain lower vacancy rates at 8.8%, highlighting the sustained demand for prime locations.
Tenant Demand: Lease Renegotiations Dominate
In 2024, total tenant activity in Warsaw’s office market reached 740,000 sqm, a slight 1% decrease YoY. Lease renewals dominated, accounting for 46% of all transactions (+3 percentage points YoY). Net demand, which includes new leases and expansions, fell by 6% YoY to 400,000 sqm.
Limited availability of large office spaces prompted an increase in sublease activity as a cost-optimization strategy. The largest transaction in 2024 was Santander Bank’s pre-lease of 24,500 sqm in The Bridge. Other notable transactions, ranging from 13,000 to 14,000 sqm, involved lease renewals and renegotiations in buildings like Atrium Garden, Varso Place 2, T-Mobile Office Park, and Domaniewska Office Hub. Key tenant sectors included finance, manufacturing, business services, and IT.
Stable Rents, Rising Operating Costs
Bartosz Oleksak, Associate Director at AXI IMMO, explained:
“In 2024, asking rents in prestigious central locations ranged from €19.00 to €26.50 per sqm per month, with some properties exceeding €30.00 per sqm. In non-central areas, rents started at approximately €9.00 per sqm. Despite high inflation and rising construction costs, rents remained stable year-over-year. However, operating costs increased, ranging from PLN 12.00 to PLN 45.00 per sqm per month, driven by higher building maintenance expenses.”
Outlook for 2025: Supply Gap and Growth of Flexible Offices
Jakub Potocki, Associate Director at AXI IMMO, forecasted:
“In 2025, development activity in Warsaw’s office market will continue to focus on central locations, particularly around Rondo Daszyńskiego, where approximately 140,000 sqm of new office space is planned. Key trends will include the limited availability of large office modules, the growing popularity of flexible spaces, further optimization of occupied spaces, and modernization of older buildings to meet ESG standards. Tenants will increasingly prioritize quality and office design, while landlords will adapt their offerings to evolving corporate needs.”
Source: CEO.com.pl
