The office market has had to transform as the economy has recovered. The little space that was left available, the restart of the works and the skyrocketing prices are the new dynamics that the business sector has had to face when renting a space.
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According to a new study by Newmark, a firm dedicated to the real estate market analyzed how Latin America is facing this new phenomenon in the region.
At a general level, the firm assured that the return to presence has increased the number of meters occupied in financial centerswhich predicts a good closing of occupation and transactions for 2022.
In the last semester of analysis (January-June), the total inventory of square meters was 25.03 million square meters, and in the previous semester (July-December) it was 25.70 million square meters. Compared to the availability rate, there has been a slight percentage decrease, going from 23.9% in the previous semester to 23.7%.
One piece of data to highlight is the semi-annual net absorption. In 2021, the second semester, the firm showed an absorption of -539,113 square meters, mainly leveraged by the restrictions derived from covid-19. Now, with the restrictions almost completely removed, the first closure of the current year closed in a positive absorption of 95,380 square meters.
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Regarding prices, at the regional level the average rental value per square meter is US$18.63. In the previous semester it was US$18.24 mt2, which represents the result of the dynamics of fewer meters available, higher demand, higher prices. With this growing dynamic, Juan Manuel Torres, general manager of Newmark, sees positive indicators in the Latin American market that will continue to grow.
“The Latin American office market shows positive indicators, the return to face-to-face work has boosted the occupation of spaces, so that, unlike 2021, this year positive absorptions are registered,” said Torres.
In the case of Colombia, the report ensures that in the second quarter of the year, the capital continued with a moderate recovery in the office market, presenting a quarterly absorption of 12,500 square meters.
Likewise, it says that the sector reached 30,500 square meters of semi-annual absorption, well above what was registered in 2021, but still far from the usual figures in the city.
The availability rate fell to 10.9% and the trend is expected to continue, causing prices to push upwards. As of June 2022, the registered average was US$18/m²/month.
“Bogotá is one of the cities in Latin America with the lowest supply of finished spaces and since it does not have a large number of office projects whose construction ends in the rest of the year, this behavior is expected to continue during 2022, causing prices continue with an upward trend, “said the expert.
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Similarly, Torres assured that unlike Bogotá, other Latin American cities do not have the same absorption as the capital.
“Cities like Rio de Janeiro, Mexico City, Monterrey, and Sao Paulo still have a large number of unoccupied spaces as a result of the pandemic,” he concluded.
In the case of Mexico, the market is finally coming out of the negative numbers of net absorption that it presented since the beginning of 2020.
Thus, the accumulated occupation at the end of the first half of the year was more than 190 thousand square meters, which represented an increase of 33% compared to the same period last year.
Opposite cases are those of Brazil and Panama, which have not obtained favorable results, but do show signs of recovery. In Panama, the market presented a conservative drop in vacancy rates, standing at 27.4%, and in Brazil, there was a decrease in the number of transactions in the second quarter of the year, in addition to a reduction in gross absorption and net.
Paula Andrea Galeano Balaguera
