November 5 (SeeNews) - Prime office rents in Romanian capital Bucharest fell 16% on the year to an average of 252 euro ($368.6) per square metre (sq m)/per annum in the third quarter of 2009, property and investment management services provider Jones Lang LaSalle (JLL) said.
The third-quarter prime office rental rates in Bucharest were down 4.5% from the three months to June, the company said in its Q3 2009 European Office Property Clock report.
The report provided no data on office property rental levels in other cities in southeastern Europe. Prime office rental levels stablised in the majority of European markets in the third quarter but, on average, were still 16% below the level recorded a year ago, JLL said.
Despite the improving economic outlook across most European countries on the back of stimulus packages, business sentiment is improving only cautiously. Compared to the first three quarters of 2008, European office demand is 34% lower so far this year.
New completions combined with declining space requirements continue to drive up the European vacancy rate which increased by 50 basis points (bps) over the second quarter to 9.7% at the end of September.
Vacancy in particularly is an issue in central and eastern Europe (CEE) where the average vacancy rate increased by nearly 1,000 bps over the last 12 months to 15.6%, an all-time high, JLL said.
Overall Europe remains well supplied with 2.5 million sq m due for completion by the end of the year, with one third of this in CEE, particularly Moscow.
The other CEE cities covered by the report are Budapest, Kiev, Warsaw, Prague and St.Petersburg.