Caracas Office MarketView

Transcription

1 Caracas Office MarketView CBRE Global Research and Consulting SALE PRICE CLASS A 45.03% VACANCY CLASS A 15.81% LEASE RENT CLASS A 36.21% NEW SUPPLY 0 sq. m. *Arrows indicate changes from previous quarter. CARACAS PREMIUM ZONE SHOWED A SIGNIFICANT INCREASE IN ASKING SALE AND ASKING LEASE PRICES. 1 Economic and Legal Environment Quick Stats At the moment of the emission of this report, the data regarding the inflation of the month of September had not been published by the Banco Central de Current Q-o-Q Y-o-Y Venezuela (Venezuela Central Bank); however, according to official information, the cumulative inflation Vacancy 2.62% during the months of July and August was a combined 7%, which represents an annual accumulate of 63.4% (August August 2014). The Gross National Product (GPI), which for the year 2014 had not been published by the BCV (Venezuela Central Bank). The economic environment in the country has not improved over the New Supply 0 sq. m. course of this year; however, the main Average Lease Rate Bs 3, Average Sale Price Bs 675, Hot Topics Cumulative annual inflation rate from August 2013 to August 2014 over 63%. In both classes of buildings a significant increase in asking sales prices and asking lease price mainly due to controls on the economy and not by market fundamentals. The vacancy index shows an upward trend in and B buildings over the last year. No new buildings delivered to the Premium Zone office markets during this period. macroeconomic variables show that the problems have worsened. Falling persists in the production of goods, shortages of basic goods, fiscal deficit reduction monetary reserves, overvalued currency, exchange control, low foreign investment; all in an unstable social environment and unfavorable bureaucratic, legal and institutional environment, such as the Organic Labour Act and the recently enacted Law on Fair Prices, which prevents companies the freedom to set their own prices, as well as setting limits to profits. This unfavorable climate for the production of goods and services as well as capital investment has generated a sharp increase in prices and has been worsened in the months of August and September, among other factors, by the government's delay in granting the allocations of foreign currencies, conditions necessary for the normal development of the economy. Office Market During the quarter, the performance for the office market in the Northeast Premium Zone experienced a significant increase in both asking sales price as well as asking lease rate. Specifically as it relates to the asking sale prices, in buildings, the increase was 45%, whereas in growth of 48.7% was observed. In the case of the asking lease price, they increased by 36.2% in buildings and 34.6% for. Meanwhile, the property vacancy index increased slightly in this period in Class A buildings, standing at 2.62% and the decreased from 3.14% in the previous period to 2.37% during the quarter. The same trend was observed in both classes of buildings in the Premium Southeast Zone, average asking sale prices increased, compared to the previous quarter, 32.6% in buildings and 12% in buildings. The asking lease price also rose, compared to the previous period, by 57% in buildings and 34% for. The vacancy rate increased during the quarter, reaching 2.57% for and 2.7% for class B. Although the economic context has shown no signs of change or recovery in the first nine months of the year, demand for office space remains high, especially for the purchase, because it is the primary means of protecting multinationals and corporate assets as political currency exchange are not designed to allow the repatriation of funds to them, however, and although until now the supply of properties is scarce and fragmented, the trend is that the property vacancy rate tends to increase, especially in the areas allocated to the lease, so you might expect an easing by property owners in setting asking sales prices and in asking lease prices.

2 Figure 1: Office Market Premium Zone Northeast Total Net Area Vacancy Average Sale Price Average Lease Rate Sub Markets (s.qm.) (%) (Bs/sq.m.) (Bs/sq.m./mo.) El Rosal ,53 1,83% , ,27 Campo Alegre ,93 0,00% 0,00 0,00 La Castellana ,17 3,53% , ,05 Los Palos Grandes/Altamira ,61 2,79% , ,56 Total Premium Zone NE ,24 2,62% , ,67 Premium Zone Southeast Total Net Area Vacancy Average Sale Price Average Lease Rate Sub Markets (sq.m.) (%) (Bs/sq.m.) (Bs/sq.m./mo.) Las Mercedes 9.122,34 4,38% , ,00 Parcelamiento CCCT-Chuao ,88 2,14% ,46 0,00 Total Premium Zone SE ,22 2,57% , ,00 Figure 2: Economic Conditions 2 INFLATION GDP INFLATION July/August % 20,00% 18,00% 16,00% 14,00% 12,00% 10,00% 8,00% 6,00% 4,00% 2,00% 0,00% The accumulated inflation rate for July and August 2014 reached 7.13%, while inflation for the 12 month period between August 2013 and August 2014 was 63.94%, according to official data. The Central Bank of Venezuela has not released details of the GDP During Source: Central Bank of Venezuela.

3 Figure 3: Vacancy Premium Zone NE 2.62% 6% 5% 4% 3% 2% 1% 0% Figure 4:, B Vacancy Sub-Markets 7,00% 6,00% 5,00% 4,00% 3,00% 2,00% 1,00% 0,00% Caracas Office MarketView By the end of, the property vacancy rate showed an increase of 15.9% from the second quarter of 2014, standing at 2.62%. However, the property vacancy rate decreased in to 2.37%. Although in the last two years a rising trend is recorded in buildings, the vacancy rate remains low. Figure 5: Asking Sale Price PZ NE Like the last quarter, the various submarkets had low property vacancy rates during, especially for buildings. Nevertheless, in the Northeast and Southeast Zones represents a higher overall vacancy, among which La Castellana and Las Mercedes had the highest property vacancy rates, with 6.29% and 4.92% respectively. Figure: 6:, B Asking Sale Price Sub-Markets 000 s , Bs/sq. m. 000 s The asking sale price experienced a significant increase of 45% from the second quarter of the year, standing at 675, Bs per sq. m., similar behavior was observed for, registering an asking sale price of 475, Bs per sq. m., an increase of 48.69% over the previous period. In both building classes the significant increase in asking sale price was mainly due to government controls on the economy and not by a behavior based on market fundamentals. By the end of, all submarkets experienced slight variations in asking sale prices. Among the submarkets, La Castellana in the Northeast and Las Mercedes in the Southeast stood out with asking sale prices of 699, Bs per sq. m. and 744,800 Bs per sq. m. respectively. In submarkets, asking sale prices of 517,800 Bs per sq. m. were registered in La Castellana and 616, Bs per sq. m. in Las Mercedes. 3

4 Figure 7: Asking Lease Rate PZ NE 4.000, , , , , , ,00 500,00 0,00 3, Bs/sq. m./month Source: CBRE Research Venezuela,. asking lease rates showed an increase of 36.2% in, standing at 3, Bs per sq. m. per month. buildings experienced similar behavior, closed in 1, Bs per sq. m. per month, with an strong increase of 34.6% from the second quarter of the year. Figure 8:, B Asking Lease Rates Sub-Markets 5.000, , , , , , , , ,00 500,00 0,00 Asking lease rates in the Premium submarkets vary; La Castellana registered an average asking lease rate of 4,332 Bs per sq.m. per month for buildings. In buildings, Campo Alegre stood at 1,962 Bs per sq. m. per month and Las Mercedes reached 2,285 Bs per sq. m. per month in Premium Zone NE and SE respectively. Figure 9: New Office Developments Premium ZoneNE Saleable Area Available Area Building Completion Sub Markets (sq.m.) (sq.m.) La Castellana Recreo La Castellana 6.000,00 900,96 II Half 2015 La Castellana Paseo La Castellana West Tower 7.765, ,00 II Half 2015 La Castellana Paseo La Castellana East Tower ,68 0,00 I Half 2015 El Rosal No Name Tower , ,00 I Half 2016 Campo Alegre Juguetelandia Tower , ,30 I Half 2015 Campo Alegre Centro Empresarial La Esmeralda , ,00 II Half 2016 Total Premium Zone NE , ,26 Premium Zone SE Saleable Area Available Area Building Sub Markets (sq.m.) (sq.m.) Completion Las Mercedes Centro Empresarial Las Mercedes 4.319,00 0,00 I Half 2015 Las Mercedes 711 Tower 7.378,00 0,00 II Half 2014 Las Mercedes HTO Tower 3.000,00 0,00 II Half 2014 Las Mercedes Centro Financiero Madrid , ,00 II Half Las Mercedes Luxor Tower (Phase I) 9.446, ,66 II Half 2015 Las Mercedes Luxor Tower (Phase II) 4.444, ,83 II Half 2015 Total Premium Zone SE , ,49

5 CONTACTS For more information about this Local MarketView,, please contact: CBRE Venezuela Beatriz Yilo Managing Director Avenida Francisco de Miranda, Edificio Parque Ávila, Torre B e: [email protected] Francisco Mendoza Brokerage Service Manager Avenida Francisco de Miranda, Edificio Parque Ávila, Torre B, e:[email protected] Carlos Esteves Data Research Avenida Francisco de Miranda Edificio Parque Ávila, Torre B e:[email protected] + FOLLOW US 5 Global Research and Consulting This report was prepared by the CBRE Venezuela Market Research Department which is part of the CBRE Affiliated Office Network a network of preeminent researchers and consultants who collaborate to provide real estate market research, econometric forecasting and consulting solutions to real estate investors and occupiers around the globe. Disclaimer Information contained herein, including projections, has been obtained from public offers believed to be reliable. While we do not doubt its accuracy, we have not verified it and make no guarantee, warranty or representation about it. It is your responsibility to confirm independently its accuracy and completeness. This information is presented exclusively for use by CBRE clients and professionals and all rights to the material are reserved and cannot be reproduced without prior written permission of the CBRE Global Chief Economist. 5