A Good Response to Premium Buildings
Everything seems to indicate that the market for office buildings in the northern zone of Buenos Aires has definitively consolidated. This trend began in 2007, and despite the crises of recent years it still shows the potential of the sector, as well as that of the new proposals that are on the table, particularly those alongside the Pan American highway.
The numbers reflect it all, and offer a good idea of the growth: From General Paz to San Isidro, there are about 300,000 m2 in operation. Adding the Pilar circuit increases that number by about 50,000 m2 of office space, which caters to a variety of different business requirements.
The rental of AAA-level offices yields an annual return of 35% higher than that of similar offices in the city center. Offices on northern side of General Paz may reach 10% gross profitability, while farther north can exceed 15 percent.
In many of the AAA-level developments, over 70% of offered office space was taken in less than a year. Many businesses see the prices here to be extremely competitive, especially when considering the average prices of A- through AAA-level offerings. With prices around the Pan American averaging U$D 20 to 22 per m2, it is certainly a deal compared with Capital’s prices of U$D 30 to 35 per m2. The area around Avenida del Libertador tends to have good prices as well, coming in around U$D 22 to 26 per m2. Dardo Rocha’s and Lomas de San Isidro’s prices also remained stable in recent years, despite the crises.
Furthermore, the office buildings in the northern zone offers configurations that are nearly impossible to find in Capital, with unified areas of 5,000 to 10,000 m2.
Some companies require their offices to be located closer to the city center, but many find the advantages offered in the northern zone to outweigh those offered by a more central location. It all depends on the company’s profile, and their specific needs and goals.
The development of the northern zone continues to gain popularity and strengthen, as more companies see the advantages of this location. As the development gains ground, the type of businesses located in this area is diversifying.
There is still quite a lot of land available, leaving room for future growth and development.
Over 60% of the companies moving north are of great international and local prestige, including Nestle, Citibank, Merck Sharp & Done, Motorola, Carrier, Avon, Bayer and Nike.
Employees don’t seem to mind, either. A recent survey showed that employees were content with the move, easily accepting the new northern location.
Square meters are being sold at an impressive rate, and most buildings reach a high occupancy rate shortly after completion of construction. Urbana, for example, is one of the projects, and sold 80% of its 50,000 m2 upon conclusion of construction a year ago, and 10,000 m2 are still available for sale.
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