Almaty Office Market Review, Q1 2009

Almaty Office Market Analysis, обзор рынка, экономика, Казахстан, 2009 год, Алматы, офисные здания

Almaty’s “modern” office stock includes Class A and Class B offices built since the year 2000 that offer good quality construction, services, and technical specifications.

The differences between Classes A and B are not always clearly defined but features such as construction quality, interior design and layout, technical features such as air conditioning, building management systems and quality of construction tend to differentiate the two classes.

The total amount of Class A and Class B office space is estimated by Jones Lang LaSalle to be 500.000 square meters in the first quarter of 2009.

New office projects that entered the market in 2008 have established a new standard for Class A space.

This includes Essentai Park and the Almaty Financial District, Phase 1 buildings (KKB and Capital Partners Buildings).

All of these buildings developed by Capital Partners feature modern architectural design by a world-class architect, high quality materials, professional construction.

9 buildings currently fit into the Class A- category.

In general, the offices in this group feature good design with flexible interiors, adequate parking, good IT solutions and professional management.

Significantly, 8 out of the 9 offices in this category were built before 2006.

In recent years these offices have enjoyed lower vacancy rates compared to the citywide average.

In the future, many of these buildings will be re-classified as Class B+ as more high quality buildings enter the market.

There are approximately 40 Class B buildings in Almaty.

Some of these buildings were completed in the last 2 years but they have high vacancy rates and low rents due to:

Almaty Office Market Analysis

The Golden Square is the historical downtown of Almaty. Its area is defined generally by Seifullin, Makatayev, Dostyk and Satpaev streets.

Since 2000 much business activity of the city has begun moving southward due to the lack of sites for development in the city center. A concentration of Class A- business centers here are located on Dostyk Street, a major north-south street.

The Al-Farabi Corridor is a new development area that is home to a new generation of business centers

The area west of Seifullin street is seeing more office development but this section of the city is not considered to be part of downtown and it is unlikely to develop more intensively as a business center.

Class A and B Office Locations

Access to cheap capital in recent years led to a doubling of office supply from 2005 to 2007. However, the financial crisis which began in Autumn 2007 has slowed down the pace of construction in Almaty. Many projects announced for completion in 2008-2009 were stopped or delayed.
[mykey] Jones Lang LaSalle estimates that the total amount of new office space entering the market in 2009 will be approx. 200,000 square meters of gross leasable area (GLA). [/mykey]

Indications are that much of the new supply will be offered for sale as well as for lease. Thus, in spite of growth in the amount of new supply entering the market in 2008 and 2009,leasing

Almaty Office Market Review, Q1 2009