According to the amount of newly-leased modern office space throughout the city, Vilnius is the leader among the Baltic countries. Being ahead of the neighbouring countries, Vilnius dictates office trends by market activity and bold solutions – the need to reconcile the different needs of employees, changing understanding of the purpose of the office.
Last year, in Vilnius, it was leased two times more (72 thous. sq. m.) of the office space than in Tallinn (37 thous. sq. m.) and even eight times more than in Riga (9 thousand. sq. m.). It is planned that in 2017-2018 even 140 thousand. sq. m. of the highest standards of premises will be proposed for business needs, as it is published in the “Newsec” Property Outlook, Spring of 2017.
According to the statement of Jurgita Šilaikytė, Head of Brokerage at international real estate consulting company “Newsec“, today Vilnius dictates the office market trends in the region and distinguishes itself from the three Baltic States. Namely in the capital of Lithuania, the latest office market trends and businessmen and employees‘ requests are highlighted.
J. Šilaikytė notes that both by market activity and innovative proposals Vilnius is far ahead of the capitals of Latvia and Estonia.
“A stagnation period in Riga is observed. The development of the office market in this city is mostly stopped by two factors: after the disaster in the supermarket, construction regulations and permit issues are stricter, and there is a lack of a local market developers network. Even having plots of land and plans, foreign investors tend to wait for the pre-lease contracts and only then to start construction. Therefore, Riga lacks players, who would not be afraid to take risks and build an incompletely rented offices. For example, in the Latvian capital, two ultra-modern Class A offices: “Place Eleven“ (the Lithuanian company “Hanner‘s“ project) and “Z Towers” (“S.P.I. Group‘s“ project) are constructed“, – she says.
According to her, the situations are different in Vilnius and Riga, because the developers of Lithuanian office market are ready to start projects even without having the clients, pre-occupying the entire building.
A real estate expert describes Tallinn as a sustainable growing market with is the most active local participants. “Already now it is possible to see several new major projects, such as the construction the first skyscraper in the city that is taller than 100 meters – “Maakri Torn“, which will open its door in 2018 and will propose 21.5 thousand. sq. m. area. However, unlike in Vilnius, this city does not have so many foreign companies and service centers, therefore the growth is not as high,”- compares J. Šilaikytė.
According to her, one of the main reasons, why the service centers are developed in Vilnius, not in Tallinn is almost 30 percent lower wage costs. “This is a very important factor for international companies, establishing IT, financial, customer service and other service centers, when they have to choose between Vilnius and Tallinn,” – says the real estate expert.