Savills, a real estate advisory firm, has published its latest report on the office market in Wrocław for the first half of 2024. The report highlights key data and trends shaping the local office market, noting stability despite challenges such as declining demand and rising vacancy rates.
As of the end of June 2024, the total supply of modern office space in Wrocław reached 1.37 million square meters. Approximately 36% of this space is located in the city center, making this area a key office hub in the Lower Silesian capital. In the first half of the year, 32,400 square meters of new office space was introduced to the market, reflecting a slight 1% decrease compared to the same period last year. The new supply came from two completed office projects: Quorum Office Park A (18,200 square meters) and B10 Office (14,100 square meters).
By the end of the analyzed period, around 41,600 square meters of modern office space was under construction across four projects. This represents a significant 72% decrease compared to the same period last year. Most of the ongoing developments, 68% (28,600 square meters), are located in the southern part of the city, while the remaining 13,000 square meters are being built in the western area.
“The largest new office investment in Lower Silesia is currently Swobodna Spot. Echo Investment is set to build two office buildings in the Powstańców Śląskich district, with construction of the first one starting in October last year. Optimistically, by the end of 2026, Wrocław will see an addition of approximately 90,000 square meters of modern office space. This is significant for a city that attracts investors not only with its business potential but also with its educational, entertainment, and cultural offerings. Wrocław’s strength is reflected in its top position in this year’s ‘fDi Intelligence’ ranking for medium-sized cities of the future,” said Jarosław Pilch, Head of Tenant Representation at Savills.
One of the major challenges faced by the regional market was a decrease in demand, with total leasing activity reaching 49,900 square meters, a 43% decline year-on-year. By mid-year, 251,500 square meters of office space were available in Wrocław, leading to a vacancy rate of 18.2%, an increase of 210 basis points compared to the previous year. Vacancy rates varied by city zone: the highest rate was recorded in the center at 25.8%, while the western area had a rate of 17.7%, and the southern zone had the lowest rate at 8.7%.
Despite the challenging market conditions, Wrocław recorded the highest net absorption among regional cities in the first half of 2024, with 27,500 square meters. The IT sector remained the dominant tenant, accounting for 46% of leased space, followed by the manufacturing sector with a 19% share.
“In the first half of the year, lease renegotiations dominated, constituting 54% of all signed agreements. New contracts, including those signed by property owners, accounted for 42% of demand. It’s also worth noting that no pre-lease agreements were recorded during this period, indicating a cautious approach by tenants,” said Dorota Kościelniak, Director of Tenant Representation at Savills Poland. Kościelniak emphasized that the hybrid work model is significantly influencing the Wrocław office market, with companies increasingly seeking smaller offices, typically ranging from 300 to 500 square meters. Offices between 800 and 1,000 square meters are becoming rare and are considered larger spaces.
In response to dynamic market changes, there has been an observed increase in rents for the best office projects in Wrocław. Monthly rates at the end of the first half of the year ranged from €14.00 to €16.50 per square meter.
As Dorota Kościelniak commented, “Wrocław remains a key office hub and despite many market challenges, we see interest from tenants, especially from the IT and manufacturing sectors. We expect the market to stabilize in the coming quarters, with new strategic projects significantly enhancing the office offering by 2026.”
