Projects such as the 3rd Bridge, Izmit Bay Crossing, the Northern Marmara Highway and the 3rd Airport, which are among the colossal projects being built, will stimulate the real estate sector.
Cushman & Wakefield, one of the leading commercial real estate consultancy companies in the world, has published the ‘Market Analyses of Turkey’ report it prepared for the first quarter of 2016.
The report, which also includes the economic outlook of Turkey and assessments concerning its development, focused on the subjects of the office market in Turkey, its retail sector and Turkish industry. Emphasis was made on the strong economic performance achieved by Turkey in the final quarter of 2015. It was pointed out that the tensions in the geographical region in the first quarter of 2016 could create a pressure on investor confidence for the whole of this year and that this could have a negative impact on growth.
795 thousand square meters of empty space available for rent
In the first quarter report of Cushman & Wakefield, it was stated that 2016 had begun well in terms of the sector, with ongoing development activities in the Istanbul office market, and the increasing rentals.
The report stated that, together with the impact of the suppressed demand of last year, 63.000 square meters of new renting transactions had been realized and that the biggest contributors to these transactions were the banking, pharmaceuticals, consumer goods and services sectors.
It was pointed out that these sectors had realized 60 percent of the rentals in the first quarter of 2016. It was also stated that Turkish Airlines had rented a 20 thousand square meter detached building, and that this had contributed to the performance in the first quarter. With the addition of 67 thousand new offices to the supply side, it was stated that the total area of free space available for rent had reached 795 thousand square meters, and that the vacancy rate had risen to 16,7 percent. In addition to that, the total of the projects where construction is ongoing, has risen throughout the quarter, reaching 2,8 million m2 expected to be completed by the end of 2018.
Demand in the CBA will stimulate the sector
It was emphasized that the supply of new quality offices in the regions – in particular the CBA (Central Business Area) – was presenting new opportunities to the sector.
It is expected that these opportunities will stimulate the office rentals sector. The report is expecting a degeneration in the supply demand balance with the expectation that the new projects to be completed in the next 18 months would increase the supply of offices, but that demand would not be able to keep up with this supply. As a result of the increase in supply and the probable deficiency in demand, it is not considered possible that there will be a fall in the vacancy rate. According to the assessments of Cushman & Wakefield, new development regions may emerge as a result of the continuing infrastructure projects. The Finance Center in Ataşehir was shown as an example of these regions, stating that a supply of 1 million square meters of new offices would be provided in the region due to the project.