RESEARCH & FORECAST REPORT

Transcription

1 Q4 211 OFFICES BOGOTA COLOMBIA RESEARCH & FORECAST REPORT Economic Overview According to the DANE (National Administrative Department of Statistics), in the third quarter of 211, the economy grew 7.7% compared to the same period of 21, this being the largest annual variation registered since 27. Mining continues to make the most relevant contribution to the Colombian economic growth, with a variation of 12.6%, followed by transportation, storage and communication with 7.2%. Repair services, restaurants and commerce grew 6.6%. It is worth to highlight that construction registered a growth of 3.7%, due to an increase of civil projects and value added to buildings. MARKET INDICATORS Q4 SUPPLY VACANCY NET ABSORPTION CONSTRUCTION RENTAL PRICES UPDATE GDP Growth (Third Quarter Increase Rate) Despite the winter season, it is estimated that the Gross Domestic Product will close in 211 between 4. and 5., generating a greater well being and lowering the unemployment rate, which in November 211 closed in 9.2% compared to the same month of last year. While the world goes through an economic crisis and countries as Spain and the United States register unemployment rates of 7.7% and, in the same order, Colombia reaches its lowest rate in 15 years. With the Free Trade Agreement signed between Colombia and the United States in October 211, the government awaits a larger growth of the Gross Domestic Product and expects the creation of 3 to 5 thousand jobs during its first five years. The total amount of exports add up to US,43.3 million, of which 4 belong to the manufacturing industry, 2 to the agro industrial sector, % to services and to garments. The main destinations are United States, China, Ecuador and Holland. As of today, Colombia has Free Trade Agreements signed with the European Free Trade Association EFTA (Iceland, Liechtestein, Norway) and the European Union, and in negotiation with South Korea, Panama and Turkey. Colombia hopes, in a nearby future, to sign agreements with Japan, Australia, New Zealand and Dominican Republic, among others, which would allow these export rates to grow. On the other hand, the inflation rate closed in 211 in 3.7, registering an increase of.56 percentage points in comparison to the 21 year end rate, mostly due to food products and regulated food products. Even though throughout the year the inflation rate showed a growing trend, it did not overcome the stipulated ranges of the Republic Bank, who established the inflation goal between 2% and. For 212, it is estimated that Colombia will have en economic growth of 5.. Despite the fact that it would be slowed down by the European crisis, the country will place itself over Latin American countries like Brazil, Chile and Mexico. According to BBVA Research, while a time of low economic growth is taking place worldwide, it is expected that the Colombian economy maintains itself over the potential rate. The inflation will remain stable, which is expected to end the year in 3. due to the moderate increase of international basic product prices, specially petroleum.

2 RESEARCH & FORECAST REPORT Q4 211 OFFICES Graph 1 SUPPLY DISTRIBUTION BY LOCATION (sqm) The submarkets Others and Chico rank the first places in regards to the supply, in average there are 25 and square meters available, in the same order, in this zones. Graph 2 Chicó 2 Cll. 1 1 Centro Int. Av. Chile Nogal Sta. 1 Andino Others 2 Salitre 1 SUPPLY During 211, the office inventory grew in 9.6% with the entry of nearly 144, rentable square meters, distributed in 21 buildings, 27% less than the amount constructed and completed in 21. A+ offices registered the greatest development, with an increase of 1, followed by A offices, with 1. By the end of 211, 62,316 square meters were available for rent, 49% less than the amount registered in 21, behavior that is consequent to the decrease presented in the completion of buildings and to the fast occupation of the new complexes, since these are commercialized during their construction phase. It is worth to highlight that 37% of the supply belong to class A offices, followed by B offices, with 3. For 212, Colliers International estimates that the office supply will maintain stable due to the build-to-suit phenomenon and the moderate inventory growth, which is expected to increase between 6-9% during this year. NEW SUPPLY Near 66,9 rentable square meters are projected in Bogota, of which 36% are under construction and the rest are planned. It is important to highlight that the projects only start the construction when they reach the break even point of sales. In addition, some complexes favor the sale of large areas, preferring to have only one occupant that takes at least 4 of the property. On the other hand, Salitre remains on top of the supply; being one of the few corporate zones of the city that has land to develop. For this reason, it is expected that new office submarkets, different from the traditional ones, will be created, increasing the office space supply in Bogota. Proof of this is the Other submarket s participation in 3 of the available space. It is important to mention that 5 of the square meters projected are class A+, followed by Class A with 4, therefore it is estimated that in 4 years the inventory of theses two classes will grow in 5. Salitre 5 Graph 3. SUPPLY HISTORIC BEHAVIOR BY BUILDING CLASS(sqm) Others Chico 7% 12. Santa Barba Centro Int. Calle 1 Nogal 2% Under Construction Planned Build to Suit NEW SUPPLY DISTRIBUTION BY LOCATION (sqm) Total A B A+ I II III IV I II III IV I II III IV I II III IV I II III IV I II III IV I II III IV P. 2 COLLIERS INTERNATIONAL

3 Square meters RESEARCH & FORECAST REPORT Q4 211 OFFICES DEMAND MARKET INDICATORS Q4 21 vs. Q4 211 ANDINO AV. CHILE CALLE 1 CENTRO INTERNACIONAL CHICO Vacancy Prices The net absorption of the three classes during 211 reached a record of square meters, 12% more than the amount registered in 21. The growth presented during these last two years show the occupation of spaces mainly in new buildings, that were rented and/or sold in a construction or planning phase. In addition, it is important to mention that this sustained growth is presented as a result of the country s good economic performance, the renewal of spaces and the growth of local companies and the entrance of multinational companies into the country. Class A+ spaces in 211 ranked first place, with a participation of 5 of the total absorption, class A offices followed with 3 of the total, this as a result of the scaling process that is taking place in the city. An analysis of absorption by submarket establishes that Santa is responsible of 36% of the total demand, it is important to mention that 3 of the rentable square meters that were added to the inventory during 211 were constructed in this submarket, while Chico registered 2. NOGAL SALITRE SANTA BÁRBARA OTHERS Since 21, Build-to-suit projects have dominated construction, for this reason, the office inventory growth is tied directly to the behavior of the demand, correlation that comes from an oversupply in the city, maintaining the vacancy rate between and. Meanwhile, the vacancy rate of the three office classes by the end of the fourth quarter registered 3.7%, four percentage points below the vacancy rate in 21. Class A+ and A offices have a rate of. Colliers International estimates that in 212 these rates will be stable. Graph 4. INVENTORY, ABSORPTION AND VACANCY RATE CLASS A+ AND A The Others submarket registers the highest vacancy rate of the A class offices, this due mainly to the one registered in the Zona Franca Business Center building, that has around 31 offices available, with an average area of 18 square meters Andino Av. Chile 2% Calle 1 Centro Int. 6% Chico Nogal Others Salitre Sta. Inventory Absorption Vacancy Rate UPDATE. Class A+ and A Market s Behavior Projection Inventory Net Absorption Vacancy Rate 1 1 6% * 213* 214* 16% 12% P. 3 COLLIERS INTERNATIONAL

4 29,6 23,1 16,6 29, ,4 23,4,8,1 18,6 6 69,5 COP / sqm COP / sqm RESEARCH & FORECAST REPORT Q4 211 OFFICES Graph 6. RENTAL PRICES Q4 PRICES A+ A B Since 21, and more so in 211, asking prices have shown a stabilization trend, which comes as a result of a growth phase that started in 24. When compared to the same period of 21 by class, it is found that Class B offices had the most representative variation, with an increase of 1, reaching an average price of COP 46,95 (US 24.3) per square meter. In addition, A+ and A office spaces registered positive variations of.2% and, respectively, ending the year in an average of COP (US 29) and COP 49.9 (US 25.8) per square meter. Andino, Nogal and Santa ssssssssssss are the submarkets that presented the highest rental average values in class A+ and A offices, registering prices of COP 69,55 (US 36), COP 62,5 (US 32.3) and COP 55,3 (US 28.6) per square meter. It is important to highlight that the rental values analyzed in this market report make reference to average asking prices, in other words, the amount of money that the owner is requesting for his office spaces. Colliers International estimates that in the year 212 the office rental prices will continue to go through a stabilization process, trending upward in comparison to the prices that were registered in 211. Graph 5. AVERAGE RENTAL PRICES RANGE OF CLASS A+ AND BY SUBMARKET CLASS A+ AND A RENTAL PRICE RANGE Santa continues to register the highest rental prices ,6,2 37,2 2,1 36,2 35,1,1 33,6 2,7 32,6 32,1 3,5 23,8 US 3,5 25,3 2. Santa Salitre Andino Others Chico Nogal Calle 1 Avenida Chile A+ A US Rental Prices LATAM Q4 - (US / sqm) Colliers International compared the rental price ranges of the most representative A+ buildings of each city. Brazil registered the highest amounts, with a remarkable difference 18 compared to the other Latin-American countries. Sao Paulo Santiago Bogota Mexico DF Buenos Aires San Jose Lima Brasil Brasil Brasil Chile Chile Chile Brasil Colombia Colombia Chile Argentina Argentina Colombia México México Argentina Panamá México Panamá Costa Panamá México Costa Rica Rica Costa Panamá Perú Rica Perú Costa PerúRica Perú P. 4 COLLIERS INTERNATIONAL

5 RESEARCH & FORECAST REPORT Q4 211 OFFICES Conceptual Aspects Vacancy Rate Ratio between the total inventory space and the vacant space Cummulative Annal Net Absorption The change in the number of square meters of occupied space in a determined period of time. In this report the period under analysis is December 29 to June 21. Inventory Field of study. In includes any finished class A+, A or B property found in the main submarkets monitored by Colliers International, that is, a property not under construction or still planned. Submarket Geographic area considered under an analysis sector, it corresponds to a geographic zone where a concentration of real estate classes are found, which are studied. GDP (Gross Domestic Product) Total value of goods and services produced within a country in a determined period of time. Consulted Articles DANE Indicadores Económicos September 211. BBVA Research Fuerte crecimiento económico en el 3T11, December 211. PORTAFOLIO Economía colombiana creció 7,7% en tercer trimestre, December 211. PROEXPORT Un Aliado Estratégico Para Empresarios Internacionales, August 211 DEPARTAMENTO NACIONAL DE PLANEACIÓN Mayores exportaciones Class A+ Buildings (A Plus) Class A+ (A Plus) are high especifications buildings, which means they have the following characteristics: Ten or fewer years since construction; floor to ceiling height greater than or equal to 3. meters; one parking space for every 3 square meters of office; advanced communications, fire safety, and access systems. Other important variables are location, access roads to the building, and proximity to important city centers. Class A Buildings The characteristics of class A buildings are: 11 to 2 years since construction; floor to ceiling height up to 2.8 meters; one parking space for every 4 square meters of office; and medium range fire safety and access systems. Class B Buildings The characteristics of class B buildings are: 21 to 25 years since construction; floor to ceiling height up to 2.5 meters; one parking space for every 5 square meters or more of office; and basic fire safety and access systems. y más empleo traerá TLC con Estados Unidos, August 211. DANE Principales Resultados del Mercado Laboral a Noviembre de 211, December 211. BBVA Research Situación Latinoamérica Cuarto Trimestre 211, November 211. EL PAÍS PIB del tercer trimestre de 211 subió 7,7% en Colombia, December offices in 61 countries in 6 continents United States: 125 Canada:38 Latin America: 18 Asia and Pacific: 214 EMEA: 117 administration RESEARCHER: Bogotá, Colombia Aurora Turriago Market Research Manager Cra. # Tower 2, 16 th Floor TEL ext. FAX This document has been prepared by Colliers International and is informative. The information has been provided by reliable sources and is presented in the exact form it was received. The sources include real estate associations and councils, and government agencies, among others. Colliers International does not guarantee or take responsibility for the accuracy of the information provided, any interested part must take responsibility for its own research on the exactitude of the information. Colliers International excludes all inferred or implied terms, conditions and warranties that may arise regarding this document and excludes all liability for damages that may arise. This report and other research papers can be found on our web site Colliers International provides global real estate services through 15, professionals in over 512 offices in 61 countries. Colliers has annual revenue up to US 2 billion, an annual volume of transactions worth over U.S. 53 billion and has over 91 million square meters under management. Accelerating success.