Office rents in Tel-Aviv soared 16% last year

Tel-Aviv office rents recorded the second highest leap in Europe in 2011, according to the world's most comprehensive EMEA office market survey by CBRE real estate services company. Office rents in Tel-Aviv soared an average 16.07%; Moscow recorded the highest leap for the second consecutive year, with a 33.3% climb in rent prices per meter of office space.

Climbing office space rents coincide with the commercial real estate market estimate that Tel-Aviv, Israel's business metropolis, is heading for full occupancy within just three years. Owner of MAN Properties, CBRE's Israel representative, Jacky Mukmel said last week that "if you buy an office building today, you will have a tombstone of money". "The entire commercial real estate market is for sale and there is not one developer that will refuse a cash deal". Mukmel also said he does not know "who will be using all of the office towers that are planned to go up in Tel-Aviv in the near future. The Electra office building has been on the market for three years and marketing efforts are still underway".

According to CBRE's review, with the exception of several Eastern European and European capitals, office space rents in Europe remained static throughout 2011, while southern European markets such as Sophia and Belgrade declined. Furthermore, some markets such as Madrid, which remained static, are expecting declines in the upcoming year, claims CBRE.

Source Ynet