Commercial housing: Why rents are constantly increasing

Commercial housing: Why rents are constantly increasing – Prices by area

“I want to categorically assure that no study by any institute, any company, nor by the Bank of Greece speaks of real estate bubble,” said today, speaking to ERTNEWS o real estate appraiser, Yiannis Xylas. “A bubble means a violent reversal of the balance between supply and demand, and right now we’re not experiencing that,” appreciate.

Referring to office prices he said that “Greece is a bit like a small Galatian villagebecause where offices have experienced a recession in recent years throughout Western Europe and America, in Greece over the last ten years we have seen a continuous increase in office values.”

“That’s what happens,” he explained. “because it is the phase of the cycle that we are in. Real estate, such as stocks or commodities, have rising phases. We reach the peak and then they go down to the lowest point. At the moment in Western Europe we have come out of a real estate slump and are facing a virtuous cycle of rising valuesn”.

In Greece, the office market can be categorized into three main major categories:

The first category is the one where we have quality modern green offices that can fetch rents above and 30 euros per square meter per month. “The question is how many of these properties are, and let me tell you that these properties are not currently more than 100 in all of Greece”commented Mr. Xylas
The second category, which concerns the very large majority of properties, are old renovated offices in Kolonaki and in central streets of Athens such as Mesogeion Avenue, Syngrou Avenue, Kifisias Avenue where we can go to a range 15 to 20 euros per square meter.
The third category concerns a multitude of older, unrenovated offices, which is 70% to 80% of all offices. Those offices that are neither in central areas, nor on main roads, are currently struggling to record rents that are above 10 euros per square meter per month.

The pandemic has left a large backlog of people who can work from home, so companies’ housing needs have decreased. Reduced corporate housing needs means less square footage in better buildings.