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The fourth quarter was exceptional and represented the strongest single quarter in history. In total EUR 2,284 mln was transacted in Q4. We recorded four individual transactions with a volume of above EUR 100 mln.
In Q4, office transactions dominated the market accounting for more than EUR 1.1 bln (49% share) followed by industrial with 42% share.
The total investment volume in 2016 amounted to EUR 3,767 mln, boosted by sale of the P3 Logistics Parks business.
In 2016, the office sector dominated with more than a 43% share of total investment volume, followed by the industrial sector (28% share) and the retail sector (17% share).
Following strong investor demand across all sectors, yield compression has continued across the board in 2016.
We expect the positive market sentiment to continue into 2017 and we believe that the EUR 3 bln boundary could be exceeded once again.
•In 2016 as a whole, a total of 33,400 sq m of modern office space was added to the market . This represents the lowest annual new supply in the history of the Czech market. Of this space, 66% is already occupied.
•The vacancy rate decreased at the end of 2016 to 10.6%. This was caused by strong demand in partnership with the historically low levels of new supply. We expect the vacancy rate to decrease slightly despite the increase of expected supply for 2017.
•We monitored the strongest annual take-up in history with 305,400 sq m. Total leasing activity was 8% below the record level of 2015. The largest transaction of the year 2016 was the 15,100 sq m signed by Johnson & Johnson.
•Net absorption was 37% lower than in 2015, however remained high, above 110,000 sq m, confirming the strong demand for new space.