0100 000200 000300 000400 000500 000600 000
June - Dec. 2009201020112012
Source: DTZResearch
Pipeline oce supplyaccording to developers
Early planning stagePlanning consentBuilding permitUnder construction
sq m
www.dtz.com/pl
2
Skyline TrackerWARSAW
Europark, Warsaw
Foreword
Oce development pipeline assessmentshave become increasingly dicult toaccurately gauge as projects come underpressure due to tightening liquidity andincreased caution among occupiers. The market has become trickier to interpretwith market disinformation circulatingregarding planned completions. In order toprovide increased clarity, DTZ is launchinga new series of regular research alerts onoce development activity in the CEEregion’s capital cities, with the rst analysisfocusing on Warsaw’s oce market.We believe there is a premium on a clear,systematic approach to understanding thesupply pipeline in this dynamic sector. The DTZ Skyline Tracker adopts a strictempirical approach to tracking the develop-ment status of all major oce projects, frominitial proposals to those currently underconstruction. Based on measurable andobjective criteria, including regular photoinspections of the projects, the alerts sortschemes according to their maturity in thedevelopment process, benchmarked againstproject planning permission and targetcompletion date.By providing the most up-to-date anddenitive analysis of development pipelinesDTZ Skyline Tracker aims to provide the mostauthoritative and objective assessment of oce supply, further enhancing DTZ’scapability in oce market research.
In order to provide a reference point for ourdevelopment pipeline assessments, DTZcollected data from developers regardingtheir projects under construction andplanned.According to developers’ plans, almost 1.1million sq m of modern oce space indierent stages of development is scheduledfor completion between June 2009 and 2012.Projects with a total oce space of 292 500sq m are currently under construction, whileschemes totalling approximately 310 000 sq mhave been granted building permits (whichaccording to Polish law implies an obligationto start construction within two years). Theremaining supply is in the planning stage.According to developers’ announcements, bythe end of 2009 nearly 140 000 sq m of ocespace is expected to come to market which,together with projects already completed inthe rst ve months of this year, generates anannual volume of new supply exceeding300 000 sq m.Plans regarding oce space scheduled fordelivery after 2010 have been reviseddramatically in comparison to the volumesocially forecast at the beginning of 2009.Currently, developers claim that approxima-tely 126 000 sq m is going to be completed in2010, representing a decrease of 50% oninitial assumptions. The sharp decrease stemsfrom project delays, mostly due to thedeteriorating economic climate andproblems obtaining nancing for newschemes.
PLAN OF ACTION –Pipeline supply by ocial status
Historically, certain developers have beenunduly optimistic regarding the likelihoodand the time required to obtain planningconsents and building permits. The develop-ment of many buildings commenced severalyears after they were initially proposed, andmany projects never even started. Despiteseverely restricted debt facilities and asignicant drop in demand, some investorsand developers still cling to ambitious targetdates for new deliveries.According to developers’ projections, thespace due for delivery in 2011 amounts to asmuch as 480 000 sq m, followed by 345 000sq m in 2012. The vast majority of theseschemes have received building permits orobtained planning consents. However, itshould be noted that the bulk of deliveriesscheduled for 2011-2012 may not becompleted in time as a result of completed intime as result of previously indicated issues.DTZ believes at least 30-35% of the2011-2012 pipeline supply scheduled fordelivery will be delayed and some may neverstart.
ON CLOSER INSPECTION –DTZ Skyline Tracker
In addition to assessing the ocial status of projects DTZ has inspected projects underconstruction in order to determine theircurrent stage of development. The verica-tion included checks of levels completed andprogress with shell construction.Developers’ plans regarding schemesscheduled for completion in 2009-2010 arerealistic. This is because all of these projectssecured construction nancing and are atadvanced stages of development. Taking intoconsideration the maturity of schemes underconstruction (all veried by DTZ during siteinspections), which total 292 500 sq m, 59.1%are already undertaking installation worksand are expected to shortly obtain occupan-cy permits.DTZ believes that due to the much harsherglobal economic climate, the actual volumeof deliveries in 2011 is expected be
Supply under construction by status
wind & water tightdeveloper standardt-out and occupationpermitshell & core
8.9 %59.1 %31.9 %
Source: DTZResearch
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