Colliers' new report, ”CEE Office Markets on the Green Path - Decarbonisation Potential”, analyses office markets in 11 cities across the region. Although the pace of new office deliveries has slowed recently, sustainability remains a priority for developers.

Approximately 93% of new office buildings in Bucharest, constructed in the last seven years, and 70% of older buildings over 15 years old, hold green certifications, reflecting a strong commitment to sustainability and energy efficiency. In comparison, only Warsaw surpasses Bucharest in terms of green-certified office buildings, with 98% of newly built office spaces holding certifications.

20% decline in leasing demanding

Bucharest’s office market closed 2024 with a total leasing demand of nearly 339,000 square meters, marking a 20% decline compared to the historic peak in 2023, yet remaining above the five-year average.

“Office markets in CEE are undergoing a transformation, driven by an ageing building stock and increasingly stringent decarbonisation requirements imposed by European regulations and global trends. Romania is a key player in the region and while well positioned to adopt sustainability standards, it also has a significant stock of older buildings, comparable to those in Bratislava and Budapest. Upgrading these buildings represents a significant investment opportunity that can improve the long-term competitiveness of the market and attract developers looking to meet current sustainability requirements. The strong performance of green certifications increases the attractiveness of the local market for investors and contributes to the creation of a more competitive business environment", explains Victor Coșconel, Partner, Head of Leasing, Office & Industrial Agencies at Colliers.

Moreover, according to Colliers' leasing data, efficient buildings in prime locations are in higher demand among tenants. The vacancy rate for relatively new buildings in Bucharest, where the percentage of green certifications is very high, remains in the single digits. By contrast, older buildings - often in less central locations and with lower energy efficiency - have vacancy rates approaching 20%.

On the other hand, the data for 2024 indicate a slowdown in overall rental demand. However, in terms of new demand, 116,000 square metres was recorded last year, a level similar to 2023.

Colliers advisors note that demand for newly built, certified and energy-efficient office space remains high in Romania, similar to other mature markets in the region. In Bucharest, newly built office buildings (0-7 years old) have a significantly lower vacancy rate of just 5% and command higher rents, reflecting tenants' preference for operating cost savings and modern amenities.

“Green certifications, combined with the balance between supply and demand, further strengthen Bucharest's position as a preferred destination for investors and tenants who prioritise sustainability. This model of adaptation and sustainable development highlights Romania's maturity within the regional office market”, notes Victor Coșconel.

Average rent for office space - 16.5 euros

The limited supply pipeline for 2024 and 2025, notes the Colliers director, could lead to an increase in rental prices for Class A office space in prime locations, a trend that will be reinforced by the growing demand for space that meets sustainability standards. In Bucharest, office space in buildings up to seven years old rents at an average of around 16.5 euros per square metre, compared to 13 euros per square metre in buildings older than 15 years.

At the regional level, tenants are also willing to pay higher rents for new buildings due to lower operational costs and modern amenities. This trend is evident in markets such as Prague (17.7 euro per square meter), Warsaw (21.0 euro per square meter), and Athens (28.5 euro per square meter). Additionally, the preference for office spaces in newer buildings (0-7 years old) is reflected in higher occupancy rates compared to older properties.