International Real Estate Consulting Company "Newsecrepresented Western Union Processing Lithuania (WU), a company managed by Western Union, the global leader in cash transfers, in more than 15 cases. sq. m office lease agreement with the Finnish real estate investment and management company Technopolis.
Before the transaction, WU was located in three "Technopolis" buildings located in the Oz Park district of Vilnius, and after the transaction, it concentrated the rented premises in two business centers and increased the total area of the premises. From now on, WU will occupy the entire Gama building and 66 percent. of the area of the Delta business center, and after completing the development of the service center, the company will occupy a total of more than 25 square meters in the business park. sq. m. The area leased by the company is the largest office lease deal concluded in Vilnius this year.
"WU's decision to continue the long-term lease and carry out development in the Technopolis business park was determined by the strategically convenient location, the infrastructure formed in this area, a professional office manager, as well as the quality parameters of the buildings - rational and flexible use of space, offices designed and equipped according to the needs of WU". - says Martynas Babilas, head of Newsec's tenant representation group in the Baltic countries.
According to Lina Maskoliūnė, head of Technopolis' Lithuanian business region, this transaction is the result of Technopolis' approach to long-term cooperation and the great trust gained during it.
"The renewal of the WU contract with further expansion in our business park shows that we are well responsive to the needs of our customers. Today, the most important things for business are attracting talent, keeping them and ensuring business continuity through high-quality and stable infrastructure. It's our job to help our customers take care of that, and the COVID-19 crisis has shown even better how strong and flexible we are and what a smooth infrastructure and customer service culture we've built," she notes.
Since the start of operations in Lithuania in 2011, WU has been developing and expanding in the territory of Oz, the buildings of which were purchased by Technopolis in 2013. Having started its activities in the "Beta" building, in 2013 WU expanded into Gama, and with the construction of Delta in late 2016, the company leased space in this office building as well. "For such rapidly growing companies, business parks with common infrastructure are a very convenient and flexible solution. In this way, we can guarantee the tenant a smooth development in one area, without being scattered across several parts of the city. Also, during seven years of activity in Lithuania, we have made sure that the wide range of additional office services we offer meets the quality expectations of not only small and medium-sized tenants, such as WU", - L. Maskoliūnė mentions the advantages of business park infrastructure.
After the transaction, WU will occupy the entire area of the building - 11 sq. m. m, and in the nearby B+ class Delta building, the company will occupy about 300 percent. of the building - 66 sq.m. Delta is also home to a large number of small and medium-sized businesses, including the 14-job co-working space UMA. The B+ class business centers "Alfa", "Beta" (two office buildings), "Gama", "Penta" and the construction of "Nova" are also located on the territory of Oz. All the buildings of this business park are rated with LEED "Gold" certificates.
Tenants will not drastically change their plans
"The Vilnius office market is currently particularly favorable for tenants in terms of the number of alternatives, and what's more, new large-scale B+ class office buildings are being built, which will increase the supply of quality space. However, after carefully evaluating the available options, Technopoli's offer was the most suitable for the needs of Western Union Processing Lithuania, so the process of the office lease transaction was smooth. So far, this is the biggest office deal of this year, not only in Vilnius, but also in all the Baltic countries, which demonstrates the active development of service centers already operating in the market", says M. Babilas.
According to the expert, despite the uncertainty in the market caused by the pandemic, the office segment remains among the least affected in the real estate sector and lease extensions may increase: "Although large companies continue to plan partial work from home, they do not reduce office space, believing that the office will still remain the main place for work and for cooperation - this is also illustrated by the decision chosen by WU", says M. Babilas.
He emphasizes that regardless of the record leasing transactions of the I and II quarters, this year the total annual absorption of space will be slightly lower compared to last year (which was a record year in the history of the Vilnius office market) due to several postponed leasing transactions.
"However, companies whose lease contracts are expiring will have to make one or another decision, so I think this year there will be more contract extensions than relocations, and the contracts themselves will be shorter - 1-2 years, thus agreeing on short-term flexibility." On the other hand, there are a number of growing companies, especially in the technology and service center sectors, which have a clear need for office space and are willing to move to new and larger offices," says the head of Newsec's tenant representation group in the Baltic countries.
