Leyla İLHAN
The investor, who moved to housing in the last year due to the increasing rental income, turned his route to the office due to the restriction on home loans and rent increase. Since the last four years, new production in the office market has been almost at a standstill. The decrease in the effect of the pandemic and the increase in the demand for the office made the office market attractive again for the investor. Sector representatives point out that with the increasing demand, there may be a supply problem in offices in 2023, as in housing. Contractors who have stopped building new offices for 5 years have started to put these projects on their agenda again.
Foreign currency Tuğra Gönden, General Manager of Cushman & Wakefield Turkey, stated that the supply of qualified new housing is gradually decreasing due to the increasing demand due to the lack of new projects in the housing for a long time, and said, “Now, we can see a very, very similar situation in the qualified office very soon. We will see this a lot, especially on the user side.” Stating that the supply shortage will be experienced especially in the large single-owned office space, Gönden said, “I exclude the Istanbul Finance Center from this. Because not everyone will be able to be in the Financial Center, since renting will be made in return for a certificate of participation.” Noting that some of the international companies that closed their operations in Russia due to the Russia-Ukraine war on the demand side have returned to Turkey and that the return to offices has increased in the last year as the effect of the pandemic has decreased, Gönden said, “Especially in regions such as Levent and Ataşehir, a very serious amount of space has melted. It is difficult to find areas larger than 2,000 square meters in single-owner buildings.” Stating that the investor has started to return to the office from the residence, Gönden said that almost all of the office stock for sale in the popular regions has melted with the demand, but the stock remains in the second regions. Noting that the sales prices per square meter are around 4-5 thousand dollars in the central areas and a thousand dollars in the peripheries, Gönden emphasized that the rents in the popular regions and offices have started to increase in foreign currency as well as inflation.
Investor’s purchases will increase at the end of the year
Emphasizing that the number of rental offices in Istanbul has decreased and the probability of facing an office shortage within a year has increased, Murat Ergin, Chairman of the Board of Directors of Kuzeybatı Real Estate, said, “At the moment, some people say that offices cannot be bought. However, investors who knew the market started buying. Others will also enter let’s mode like the end of December. Because the increase in housing first started with rents. When the rents got too high, they started saying let’s buy it. It is currently in the rental section of the office, which was in the residence last year,” he said. Explaining that in addition to domestic demand, Turkey’s cheap skilled labor force attracts foreign companies to Turkey, Ergin said, “There is also a natural population increase in Turkey. Although contractors start in office right now, they can complete it in two years. the only good news It happened that the Financial Center was coming. Otherwise, our offices are starting to fill up even now. The occupancy rates, which went down to 65-70 percent, exceeded 80 percent,” he said.
“We put the new office project on our agenda”
Bahattin Uçar, Chairman of the Board of Invest Construction, said that the BBDK restricts the housing loan limits, as well as the 25 percent limit on the rent increase, causing the investor mass to come to the house, and said, “When there was no excessive demand, the prices in the housing became a little more stable. As for the offices, there were almost no offices in Istanbul. Some of the offices in stock have been rented and some have been sold. Since the demand for offices is also high, in my opinion, we can see the situation in housing towards the end of 2023”. Noting that as a company, they will also include an office in their new projects in Istanbul, Uçar said, “We haven’t been doing a new office project for 5 years. We tried to finish the stocks in 3 years and we did. Now, with the demand, the stocks in the office are running out. We are looking for an office next year, but if we cannot find an office with the quality and square meters we want, we will talk about it.” Uçar said that because of this, companies that were worried about whether or not the industry would build an office until 6 months ago started to put office construction on their agenda as the stock went towards zero.
“Financial Center is a solution to supply shortage”
Mahir Marble, JLL Turkey Office Rental Director, said, “Some offices have also been converted into residences. In fact, with the interest in offices, the demand has increased. Rents are also starting to rise. Some of them went to ask for contracts in foreign currency,” he said. On the other hand, noting that the Finance Center with an office space of 1.5 million square meters will enter the market, Mermer said, “Even though half of the offices here are used by public institutions, 800-850 thousand square meters will be leased out. We are talking about a large supply from Maslak. Therefore, I do not see a problem”. In addition, Mermer stated that the investor is afraid of the office due to the pandemic and said, “Most of the new offices are delivered before they are completed. The investor is also more and more due to the increasing renovation costs. logisticsfocuses more on investments in warehouses and hotels. On the other hand, with demand, there will be a shift to secondary locations such as Kağıthane, where there is more office stock.”