CBRE has released a report on Poland office destinations for the modern business services sector. Each of the main locations – including Katowice – were subjected to a SWOT analysis.
In 2015 employment in the BPO/SSC segment reached 150 000 people, becoming the biggest sector (after mining) of the Polish economy. Katowice is recognized as the second tier city of this sector (together with TriCity, Łódź and Poznań), strongly developing, but offering a lower density of BPO companies, a relatively lower level of salaries and a strong aspiration to stimulate the growth of the sector when compared to the first tier cities (non-central Warsaw, Kraków and Wrocław). According to CBRE, the specialization of modern business services companies in Katowice is IT and human resources. 36% of the total office stock in the city was occupied by BPO firms in the last year.
The report recognizes strengths, weaknesses, opportunities and threats of the Katowice office market. According to the SWOT analysis, the BPO/SSC tenants can benefit from following strengths: the third largest academic hub of Poland, second largest agglomeration, high institutional support for investors, stable rental levels and highly developed road infrastructure, public transport and international airport. The three main weaknesses include: undefined business districts, low amount of A class office space as well as limited experience and business networking.
Growing number of office developments and possibility to become a satellite location for a highly developed BPO/SSC sector in Kraków were recognized as opportunities. CBRE also named three main threats for the market: competition from new companies in terms of qualified staff, growing cost of operation and high competition from locations like Rzeszów or Kraków (it is worth to mention that Katowice was also mentioned as the main competitor for Kraków in the SWOT analysis of this city).
The publication also presents a characteristic of typical lease terms – tenants can expect 7-9 months of rent-free period and a fit-out budget of EUR 100-150 per one square meter. Parking space costs are between EUR 50 and EUR 65 per one month, service charges range from PLN 14 to PLN 16 per one square meter per month.
Prime rents amount to EUR 13/sq.m/month, average rents are EUR 12,5/sq.m/month, while average effective rents total EUR 10,5/sq.m/month.