december 2009 market report

8/11/2019 December 2009 Market Report

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ISTANBUL OFFICE MARKET REPORT

December 2009

PEGA Commerci al Real Estate Services


2/10


3/10

Class A office building that Asian Side's

fastest growing region in Umraniye, can be

delivered immediately.

Leasable Area: 11.841 m

Flor Area: 945 m (gross)

832 m (net)

Parking: 1 car for per 77 m

Ai r Condi tioning: VRV

Delivery: Shell & Core

Tax: VAT

Rent: 16 $ - 22 $

PEGA Commerc ial Real Estate ServicesPEGA Commerc ial Real Estate Services


4/10

The first Mix-Use Project in Konya is including shopping center, residence and hotel.

Land Area: 33,982 m

Construction Area: 143,171 m

For investment proposals;

0212 257 1810



5/10

Class A office building in Balmumcu.

Dublex office and staff refectory (including

kitchen) are for rent.

Total Building: 4.050 m

Leasable Area: 810 m + 150 m

Floor Area: 405 m (gross)

380 m (net)

Ai r Condi tioning: Fan-Coil

Delivery: Decorated

TAX: Withholding

Rent: 12.000 USD



6/10

Central Business District

Class A buildings are concentrated in the Levent-Zincirlikuyu-Maslak region (in red), which isconsidered Istanbuls Central Business District(CBD). The primary suburban office markets are theGunesli-Ikitelli and Merter districts (in blue) in thewest on the European side, and Altunizade (inpurple), Kozyatagi (in green), Kavacik (in yellow) andmraniye (in black) on the Asian side.

According to international standards and Pegasaffiliations with SIOR (The Society of Industrial andOffice Realtors), offices in Istanbul are classified asCBD, Class A and Class B; and out of CBD, Class Aand Class B; and can be identified as follows:

CBD: the area of greatest concentration of officespace and business services. Istanbuls CBDconsists of the Beikta Maslak axis, includingBeikta, Fulya, Balmumcu, Zincirlikuyu,Esentepe,ili, Etiler, Akatlar, Levent andMaslak.

Out of CBD: secondary concentrations of officespace consisting of Kozyata, Altunizade,Kavack, Merter and the airport region.

Class A: Buildings purpose-built for office usethat offer the highest technical standardsavailable and amenities including, but not limitedto: professional security, open office space,indoor parking, central HVAC, sprinklers and

generator are considered Class A. WhileInternational Standards call for minimum floorplate size of 500m2 for Class A consideration, inTurkey, some buildings with slightly smaller floorplates may be considered Class A if they meetthe other criteria.

Class A+: The buildings that have somewhathigher standards than A class office buildings.The developers, aware of state of the arttechnology and taking the suggestions of theend users into consideration, make thedifference in their buildings. Therefore, Pegahas assigned these kinds of buildings as A+Class.

Office leases in Istanbul are triple-net, with thetenant responsible for monthly common charges(currently between $2.00 and $8.00 per m permonth), and applicable taxes (VAT of 18% if thelandlord is a corporate entity or withholding tax ofapproximately 20% if the landlord is a privateindividual).

No organized database of properties exists in themarket and all of Pegas data is obtained by phoneand face-to-face interviews and does not includeowner-occupied space, for which limited informationis available.



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Rental Rates and Vacancy Rates

Approximately 70 buildings in the CBD and 169 suburban buildings qualify as Class A+, Class A and Clas

OFFICE STOCK

Class A+total m

Class Atotal m

Class Btotal m TOTAL

265.977 1.722.417 558.878 2.547.272

Vacancy rates and rental rates (including existing leases) of A+ and A class buildings within the CBD and the CBD are shown in the table below.

Rental Rates and Vacancy Rates(Class A+, A and B)

20,81%

8,74%

$15,22

$25,50

0%

5%

10%

15%

20%

25%

CBD Out of CBD$0$5$10$15$20$25$30

Vacancy Rates Rental Rates

Vacancy rates and rental rates (including existing leases) of B class buildings within the CBD and outside tare shown in the table below.

Rental Rates and Vacancy Rates(Class B)

9,53%11,78%

$16,50$11,56

0%

5%

10%

15%

CBD Out of CBD$0$5$10$15$20$25$30

Vacancy Rates Rental Rates



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Office Stock and Average Rent

which had a minor, though noticeable impact onrental rates. Fluctuations were never more than$4/m until 2001 however, when prices dropped topreviously-unseen lows and remained low until thesecond half of 2005. Rents began to increase after2006 and in 2008 reached the highest point onaverage $ 17. Rents in 2009 under the influence ofeconomic crisis dropped to $16 levels and are 16,4 $at the end of the year.

The following table gives a historical reference to thetrend in the office market since 1993. It representsaverage prices for all classes of property throughoutthe city, both in the CBD and outside the CBD.While dips and peaks have been common over the15-year period, they can clearly be linked to majorissues that affected Turkey such as the economiccrisis of 1994, when average prices dropped from$19 to $15; and the 1999 Marmara Earthquake,

$17$16,4

$16$17$15

$13

$11$11$11$11

$12

$18

$19$18

$16$15

$19

$16

$0

$4

$8

$12

$16

$20

1 9 9 3

1 9 9 4

1 9 9 5

1 9 9 6

1 9 9 7

1 9 9 8

1 9 9 9

2 0 0 0

2 0 0 1

2 0 0 2

2 0 0 3

2 0 0 4

2 0 0 5

2 0 0 6

2 0 0 7

2 0 0 8

2 0 0 9 / 1

2 0 0 9 / 2

The following table shows the increase in officestock by year. The impact of the economic crisis isdramatically clear in 2001. As the economy pickedup in 2006 however, the increase in office stockseems to have less of an impact on rental rates.

In 2008, the whole world was affected by the crisis,so in 2009, a decrease in the number of buildingscan be seen entering the market.

Istanbul Office Stock

2 6 7

. 8 5 8 m

3 6 4

. 1 6 8 m

7 4 2

. 4 5 4 m

9 7 7

. 4 9 6 m

1 . 4

4 1

. 8 0 5 m

1 . 4

9 6

. 5 6 5 m

1 . 5

7 8

. 8 2 0 m

1 . 6

5 7

. 6 8 8 m

1 . 8

3 9

. 7 6 7 m

2 . 0

8 6 . 3 8 5 m

2 . 3 9 6

. 5 5 1 m

2 . 5

4 7

. 2 7 2 m

1 . 2

6 7

. 0 9 1 m

0 m

500.000 m

1.000.000 m

1.500.000 m

2.000.000 m

2.500.000 m

3.000.000 m

1 9 9 7

1 9 9 8

1 9 9 9

2 0 0 0

2 0 0 1

2 0 0 2

2 0 0 3

2 0 0 4

2 0 0 5

2 0 0 6

2 0 0 7

2 0 0 8

2 0 0 9



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Regions

The following table shows vacancy areas in all class building according to region. As seen in table, the

office stock is in Airport region. The highest vacancy rate is in Umraniye, the lowest vacancy rate is iAkatlar.

Occupied & Vacancy Area According to the Region

0100.000200.000300.000400.000500.000600.000700.000800.000

K A V A C I K

A L T U N

Z A D E

K O Z Y A T A

I -

B O S T A N C I

M R A N

Y E

L E V E N T

M A S L A K

Z . K

U Y U -

G A Y R E T T E P E -

E S E N T E P E

E T

L E R -

A K A T L A R

L

-

B E K T A

H A V A A L A N I

Occupied Area M Vacancy Area M

11,94% 11,94%

11,19%52,51%

11,05% 7,23%

15,29% 3,86%

16,95%

11,02%

The following table shows rental rates according to region. This table is created now the offices of the

information are used. Accordingly, the most expensive districts of Istanbul sorted Levent, Etiler - Akatlar s

Rental Rates According to the Region (m/mo)

$14,43 $16,22 $16,77$17,96

$34,90

$20,85 $22,57

$32,16

$23,81

$11,57

$0,00

$10,00

$20,00

$30,00

$40,00

K A V A C I K

A L T U N

Z A D E

K O Z Y A T A

I -

B O S T A N C I

M R A N

Y E

L E V E N T

M A S L A K

Z . K

U Y U -

G A Y R E T T E P E -

E S E N T E P E

E T

L E R -

A K A T L A R

L

-

B E K T A

H A V A A L A N I



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Metodoloji Ve Referanslar

Pega used the following techniques for data collection:

Pega office stock database, which includes 339 A+, A and B Class office buildings Face-to-face interviews with the landlords of main plaza buildings, Regular evaluation of periodicals, newspapers, real estate magazines and internet postings Periodic meetings with the most prominent real estate companies of Istanbul, Cold Calling.

Copyright 2009, Pega Commercial Real Estate ServicesThis Market Report aims to inform readers about the latest real estate developments in Istanbul. It does not

constitute any legal advice or opinion on any specific facts or circumstances and contents are intended as generalinformation only. Professional real estate consulting should be obtained for specific questions and concerns. Pegareserves all copyrights deriving from this Istanbul Market Report, which may not be copied, published, distributed orforwarded to third parties without the consent of Pega. Violation of Pega's intellectual property rights shall besubject to legal and penal sanctions within the framework of Law No. 5846 on Intellectual and Artistic Works.

december 2009 market report

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