Advantage of Office Space Investments
The number of vacant office spaces in Buenos Aires is going down and investors are becoming increasingly attracted to office space investments. The naure and purpose of office spaces in Buenos Aires means that they tend to follow the peaks and troughs of the economy: going through cycles of demand and surplus. Today the market is experiencing a boost in interest and demand. More and more meters squared of office spaces are being occupied by tenants who pay rents that bring in a 9% annual profit margin.
Now only 13 to 15% of office spaces in Buenos Aires are unoccupied, which is high for Buenos Aires when you compare the figures with 2002 when 25% of properties were vacant. External factors have affected the Buenos Aires real estate market in the corporate rentals sector. The global economic crisis had the biggest impact on multinational companies who in turn shrunk back their operations, freeing up plenty of high-end office space. However, there is still a shortage of office spaces in Buenos Aires that are larger than 5000m2, which is pushing up prices and making the sector all the more lucrative bit by bit. This should encourage any developers with office space plans in mind to act now and build.
As mentioned before, nonetheless, this sector can be volatile. For instance, at the end of 2009 the market slumped in such a way that class A office real estate prices dropped by 25 to 30%.
With regard to location, corporations don’t just rent in downtown Buenos Aires city. Zona Norte is another hotspot for the corporate Buenos Aires real estate sector. Here big multinational corporations like Phillips, Pan-American Bureau and the large commercial centre Dot occupy offices. All of the commercial space in Dot has been completely occupied thanks to its reputation as an exciting new opportunity and its proximity to the Panamericana Highway that links Buenos Aires province with the city.
Another exciting project in the Zona Norte area is the Torre de las Naciones (Nations Tower) in Tigre. This 17 floor corporate building is dedicated to class AAA office space and boasts views over the river and delta area. With important new developments and increase in demand Zona Norte is clearly a valued and sought after corporate location to rent.
Experts are predicting that the Buenos Aires corporate real estate market is going to increase in demand and prices in the next couple of years. No major projects will have been completed until 2013, meaning that demand and higher profits are on the horizon for investors and property owners.
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