In the third quarter of 2021, São Paulo registered considerable devolutions of office areas, revealing the monitoring of SiiLA, a multinational operating in data and analysis of the real estate market in Latin America. The impact of this scenario was significant: the balance between new leases and returns (net absorption) closed at a negative 59,921 sq meters, considering Class A+, A, and B projects in all commercial regions mapped by the platform in the city.

"The offices are suffering a lot, but we believe that in the long term, there will be accommodation. The trend is for people to return to the offices, albeit in the hybrid model. Companies need their headquarters", according to SiiLA's CEO Giancarlo Nicastro.

Practically all departures took place in the so-called primary zones (or CBDs – Central Business Districts) which include the regions: Berrini, Chácara Santo Antônio, Chucri Zaidan, Faria Lima, Itaim Bibi, JK, Marginal Pinheiros, Paulista, Pinheiros, Santo Amaro and Vila Olympia. In total, these 11 regions registered a negative balance of 53,987 sq meters (net absorption) for the period.

The SiiLA study also shows that, when analyzing only high-end properties (Classes A+ and A), the CBDs regions' vacancy rate (vacant area) ended the third quarter of 2021 at 25.65%, an increase of 1.8 percentage points compared to the 2nd quarter. Within the CBDs regions, some have a vacancy rate still below 12%, such as Faria Lima, which has 11.93% of its vacant area, Vila Olímpia, 11.67% and JK, with 11 .07%.

Atypical moment

"Covid-19, the exodus of many companies, and the requirement of working from home changed the market. In 2021, together with the remote work, the increase in the IGP-M, one of the most used indices in rental adjustment clauses, put a lot of pressure on the sector", comments Nicastro. "In this third quarter, our monitoring indicated several discards from large areas, above 2,000 sq meters, which all happened at the same time, causing this negative record. It is a very atypical movement, resulting from an unfavorable market scenario", completes the executive.

São Paulo Corporate Towers, a complex comprising 2 Class A+ towers in the JK region, was one of the negative highlights of the period, where more than 23 thousand sq meters were vacant. XP Investimentos left 5,500 sq meters. Fox channel also closed the contract for another 3,100 sq meters in the same development.

Alone, the departure of Uber represented almost 8,500 sq meters less than the leased area in the complex, and the company also devolved another 3,500 sq meters of the Morumbi Building. In 2022, Uber plans to occupy a new 30,000 sq meters headquarters in Osasco, named Uber Campus, which is currently under construction. Another expressive exit in the quarter was that of Novonor (ex-Odebrecht). The contractor returned its former headquarters of more than 18 thousand sq meters of the Pinheiros One building. The departure was already scheduled, as the company had already leased another space this year, a lot more modest, of 6 thousand sq meters.

At the beginning of the year, Enel had already leased an area in a tower in Parque da Cidade, and returned some floors of the CBOP project in Alphaville (6,887 sq meters), causing more impact. ABB also closed the contract for 6,800 sq meters in development in the Marginal Tietê region and leased almost 3 thousand sq meters in Jardim das Perdizes, in Barra Funda. And Netshoes left an entire building in the center of São Paulo (4,884 sq meters) without renting another address.

By the end of 2021, SiiLA plans to lease at least 14,195 sq meters in high-end CBD areas in São Paulo. This is the volume guaranteed by contracts at Faria Lima Plaza, two of them with Cescon, Barrieu, Flesch & Barreto Advogados, and the multinational e-commerce Shopee.

Stock arrives, the price goes up

Part of the increase in vacancy has to do with new developments incorporated into the city's office stock. Among the high-end ones, the largest delivered, with 28,334 sq meters, was Led Corporate, A+ at Barra Funda (outside the prime area of the sector). The city also got the Dynamic Faria Lima, a class A built-in Pinheiros, with 5,071 sq meters.

The average asking price of the lease was impacted by the available spaces in existing buildings, whose prices are higher, such as São Paulo Corporate itself, which raised the average value. Also, the average asking price for rent in all regions mapped by SiiLA Brazil in São Paulo, considering Class A+, A, and B projects, was 81.21 R$/sq meters in the third quarter of 2021, against 79.93 R$/sq meters placed in the previous quarter.