Kuwait City office rents rebound to peak levels
Rents in prime commercial properties in Kuwait City have returned to the peak levels, last experienced in 2008, according to CBRE.
Its Q1 Kuwait Market Snapshot said monthly rates of KD14 per square metre were quoted within the city’s landmark buildings, marking an increase of 100 percent on 2012 figures.
The report also revealed that occupancy across Grade A commercial office space is at an all-time high at 95 percent – compared to 60 percent in 2011.
“These figures demonstrate an increased demand for good quality office space in the Kuwaiti capital,” said the global real estate consultancy.
The Q1 Market Snapshot also reported that there are an estimated 250,000 square metres of Grade A office stock currently available to rent within the Central Business District of Kuwait City.
James Lynn, director of research and consultancy, CBRE, said:
“Our research clearly identifies a growing need for high quality office space and the onus is now on developers and landlords of commercial office towers to strive to meet the needs of the modern business community.
“By diversifying their offerings and providing services as well as innovative workspace solutions, developers and landlords alike can continue to take full advantage of this increased demand and successfully attract new businesses whilst retaining existing valued tenants.”
With a current pipeline supply of almost 200,000 square metres planned for delivery between 2018-2021, there will be an 80 percent increase in available stock across this sector over a short three-year period if all four high-rise developments complete construction on schedule, CBRE said in the report.
It added that market dynamics do, however, indicate that with a significant increase in office supply forecast over the short-term, the local market should begin to see downward pressure on rents as projects begin to complete and vacancy rates steadily rise.