Can the sleeping tiger in the Kaunas office market be awakened?
At the end of 2022, Kaunas had roughly 271,500 sqm of modern office space. As previously forecast, by year-end there were few attractive options left on the market for relocation or business start. The next 2 years will be dry in new supply and tenants will find little available space on offer.
KEY INSIGHTS
• Vacancy in class A has fallen to 2.2%, the lowest level since the largest class A buildings were opened and substantial new supply was added to the market in 2018-2020.
• The Kaunas office market is very short of supply, so it is difficult to offer tenants solutions. Take-up was about 5,400 sqm in H1 2022 and some 9,900 sqm in H2.
• We await more signs of a mature market in Kaunas as the potential on the office segment is huge.