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Market Note October

11/26/2020

São Paulo’s CBD regions, classes A and A+ office market registered an increase on its vacancy rate and reached 19.8% (+ 0.3 p.p), mainly due to some departures and the new completion of 11.5 thousand sq.m in Paulista´s region, which registered an increase of 4.3 p.p. in the vacancy rate and closed at 11.8%. In addition, Chucri Zaidan region presented the highest net absorption of the period (3.1 thousand sq.m) and the largest drop in the vacancy rate, reaching 20.5% (-0.5 p.p.).

OFFICE SP

São Paulo’s CBD regions, classes A and A+ office market registered an increase on its vacancy rate and reached 19.8% (+ 0.3 p.p), mainly due to some departures and the new completion of 11.5 thousand sq.m in Paulista´s region, which registered an increase of 4.3 p.p. in the vacancy rate and closed at 11.8%. In addition, Chucri Zaidan region presented the highest net absorption of the period (3.1 thousand sq.m) and the largest drop in the vacancy rate, reaching 20.5% (-0.5 p.p.).
On the other hand, the asking rent followed a positive trend throughout the month, increased and registered the average of BRL 103.17/sq.m/month (+ BRL 0.75 MoM), the highest value since 2016. This substantial increase was due to new completion in Paulista’s region, which entered the market with asking price above the average of the city, also the departures in buildings with higher asking rents, such as Pinheiros’ major market, which registered an increase of BRL 7.84 MoM and closed the month at BRL 112.75/sq.m/month.

 

OFFICE RJ 

Despite the uncertainty of Covid-19, the hybrid model of work continues to prevail in the offices. Therefore, Rio de Janeiro’s CBD regions, class A office market continued to present positive results, with a net absorption of 2,996 sq.m, totalizing 13,590 sq.m until November. Consequently, the vacancy rate dropped for the third consecutive month and reached the lowest value of the year (33%), with a drop of 0.19 p.p. (MoM) and 0.95 p.p. (YoY).
The majority of positive absorptions were due to occupations of private companies in Centro and Porto regions. Centro region presented a net absorption of 1,228 sq.m and a vacancy rate of 29.8%, reaching the minimum of the year. On the other hand, Porto region had a net absorption of 1,768 sq.m and a vacancy rate of 42.1%, reaching the lowest rate since the revitalization of the region in 2014.
The average asking rent continued in a downward trend, reaching at BRL 91.28 per sq.m/month. This was mainly due to the occupancies registered in corporate buildings with higher asking rents. Besides that, an important building at Centro’s region decreased its asking rent.

 

INDUSTRIAL SP 

São Paulo’s logistic market of classes A and A+ performed great despite not receiving new completions for the first time since June. The net absorption was once again strong in the current period, with 167 thousand sq.m, becoming the second highest absorption this year. The major market of Cajamar was responsible for 46% of this absorption with 76.9 thousand sq.m. This fact emphasizes the leading role of this region in the market with the highest net absorption and new inventory completed this year. 
Moreover, the vacancy rate had an expressive drop of 1.8 p.p. (MoM), closing the month at an all-time low 13.8%. Also, Cajamar region dropped 4.9 p.p. (MoM), recording a vacancy rate of 6.6% and overtaking the best results in January. The average asking price for São Paulo decreased 1% (MoM), closing November at BRL 18.51 per sq.m/month.

 

INDUSTRIAL RJ 

Rio de Janeiro class A and A+ logistics market did not register new deliveries in November. The State recorded a net absorption of 3.4 thousand sq.m and remained with positive absorptions since February. The major markets of Santa Cruz/Campo Grande, Avenida Brasil and Pavuna registered few transactions, however, only Duque de Caxias recorded a negative absorption (-772 sq.m).
As a result of no new completions and a positive absorption, the vacancy rate decreased 0.2 p.p. (MoM), closing the month at 17.4%, the lowest value in 2020. The asking price also had a slight drop of 0.2% (MoM), closing the month at BRL 20.69 per sq.m/month. Due to lack of available space in Avenida Brasil region – the most expensive region until last month – Pavuna’s major market registered the highest asking rent of the state (BRL 22.81 per sq.m/month), a value 10% higher than the average of Rio de Janeiro.

 

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