The Uruguayan economy conveys signs of recovery. After the great expansion of the fourth quarter of 2016, the economy expanded again last January, shifting the estimates for 2017, expecting to grow by +1.8% by year-end.
The office market of Montevideo has sluggish dynamics when it comes to stock growth. Even though the stock doubled over the last decade, production has been very fluctuating, with an average of 12,000 sq. m. per year. In relative terms, Montevideo’s office market is about 10.0% Buenos Aires’ office market, and just 5.3% of Santiago de Chile.
By mid 2017, the vacancy rate was 5.6% in the National Market and 4.1% in Free Trade Zones. The particular dynamics of the Montevideo office market causes a slow-moving absorption of new supply, however vacancy keeps on its downwards moving trend.
Average rents have been stable through 2016 and 2017, though tendencies have been divergent in the different submarkets.
The average rent for Class A/A+ in the National Market was US$ 29.44 per sq. m. per month as of H1 2017, representing 9.6% drop compared to H2 2016, the slight slope was due to the availability of second generation, lower quality existent spaces that were vacated.