Post-Pandemic: Is There a Rebound in the Office Market?

The office market, which collapsed during the pandemic, is starting to reverse the negative trend when the population resumes attending the workplace. In this sense, an incipient rising rental prices are an indication of the recovery of this real estate segment.

A recent survey by Mercado Libre together with the University of San Andrés based on the publications available on that platform between July 2021 and March of this year, concluded – among other things – that Office rents in the city of Buenos Aires increased by 33.9% in the first three months of the year.

According to this online experience, the demand was more active: it recorded a 10.8% year-over-year increase in the number of contacts registered within the platform “, according to Pablo Brener, head of Vehicles, Real Estate and Services, the Mercado Libre business unit that conducted this study.

«Another not insignificant fact is that the profitability of this type of space increased from 3.5% to 3.8% compared to April last year, demonstrating the slow recovery of the market “, he added.

The report also showed that the neighborhoods with major requests for offices are Retiro, with a positive inter-year change of 131%, and Montserrat, with 90.2%. Regarding the distribution of the ads, CABA took the podium with 62.1% of the offer. In second place appears the North Zone, with 21.7%; it is followed by the South Zone, with 9.3% and, finally, the West Zone, with 6.9%.

In addition, the number of contacts received from the offices located in the Palermo district of Buenos Aires increased by 30.9% in the period under review. insteadI, in Puerto Madero and Nuñez, demand fell 3.7% and 19.7% respectively.

While the rise in rents shows one side of the industry reactivation, it is also true that office locations they have grown much less than those of private propertieswhere the demand is more robust.

However, one factor favored the office segment: is causing the exchange delay accompanied by restrictions on the purchase of dollars many companies that have pesos surpluses are turning to real estate purchases as a store of value.

This is why large companies have decided to invest in the purchase of offices amounts in excess of US $ 150 million in the first three months this year, adding to the $ 38.7 million traded in 2021 and $ 120 million in 2020, according to a study by Cushman & Wakefield and Real Estate Report.

“We are faced with a clear opportunity to access the office market through the purchase of premium spaces on the basis of a rate of return that falls within the historical minimum values, with a market in recovery and structurally under-supplied “added Lucas Desalvo, Cushman’s head of market research.

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