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Sometimes more than 10 percent: A sharp drop in office rental prices - Walla! Business

2020-11-26T04:14:52.163Z


According to a study by CBRE Israel, since the beginning of the corona crisis, there have been sharp declines in office rental prices. A 11 percent drop in Raanana, 9 percent in Herzliya. Haifa, on the other hand, maintains stability. CBRE Chairman Jackie Mokmel: "Continued decline"


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Sometimes more than 10 percent: a sharp drop in office rental prices

According to a study by CBRE Israel, since the beginning of the corona crisis, there have been sharp declines in office rental prices.

A 11 percent drop in Raanana, 9 percent in Herzliya.

Haifa, on the other hand, maintains stability.

CBRE Chairman Jackie Mokmel: "Continued decline"

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  • Real Estate

  • Offices

Walla!

Business

Wednesday, 25 November 2020, 11:01

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In the video: Although they have already received reports and contrary to the instructions, stores in the malls have opened (Photo: Reuven Castro and Sonia Gorodisky)

A study by CBRE Israel on the office and trade industry in the third quarter of 2020 states: Since the beginning of the Corona crisis, office rents have fallen by 4% to 11% and rents in commercial areas have fallen by 5% to 13%.



In Ramat Gan, rental prices for offices fell by 4 percent in the first three quarters of 2020 and rents for commerce by 11%, in Raanana, rental prices for offices fell by 11% and in commercial areas prices fell by 6%.

In Herzliya, rental prices for offices fell by 9% and rental prices for commerce by 5%.



The two cities that were not affected by the decline in rental prices for offices and commerce are Haifa and Lod due to a shortage of office and commercial space in these cities.

The cities of Bnei Brak and Petah Tikva were most significantly affected by the corona crisis due to the large number of projects in the office industry, a high level of competition, and the activity of many purchasing groups in the industry.

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Jackie is withered

Jackie Mokmel, Chairman of CBRE Israel, says: “After more than 5 years of rental prices in offices, there has been a steady upward trend, in the 3rd quarter of 2020, the downward trend in prices continues as a result of the Corona epidemic.

"In Tel Aviv, rental prices for offices fell by 6% in the first nine months of 2020, and rental prices for shopping malls and commercial centers fell by 13%."



Mokamel continues to analyze: "In the fourth quarter of 2020, the decline in office rents is expected to continue, due to a decline in demand, vacant office space and the relocation of many employees to work from home. "There is a noticeable drop in prices, especially among users who are looking for sub-tenants (sub-lease) for their areas. They are willing to make considerable compromises in order to reduce expenses that include the management fees and property taxes that accompany the rent."



Mukamel notes that "property owners continue to wait for market developments and lower prices on a spot basis. The change among developers is mainly due to increasing the grace period and providing adjustment budgets. Most declines are reflected in the second circle and areas where construction volumes Especially in speculative rental entrepreneurship. "

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Source: walla

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