Romania’s economy grew by 4.8% in 2016, which was the fastest growth rate since 2008. As a result, office leasing activity soared in Bucharest last year, with the Romanian capital seeing the highest level of office take-up in over a decade, according to Knight Frank’s Q2 2017 Office Market Outlook for Bucharest.

An active final quarter led to Bucharest’s office take-up reaching nearly 350,000sqm of Class A and B office space in 2016, surpassing the previous year’s high by 41%.

Almost 100,000sqm of office space was leased in the first quarter of this year alone. The IT and Communication industries have dominated office space demand in the city, said Knight Frank.

Commercial property investment volumes reached €706m in Romania in 2016, around 16% higher than 2015. Although the retail sector saw the greatest allocation of capital at a 37% share of the total investment volume, the office and industrial sectors also saw a significant volume of transactional activity (31% and 30% respectively).

However, despite improved levels of activity in 2016 compared to 2015, there was no significant hardening of yields due to an increase in new supply. Prime office yields remained stable at 7.5% at the end of Q1 2017.