Prague

Space Measurement Standard

BOMA, GIF

Space Unit of Measure

Square Meters

Financial Data Below Reported In

EUR

5%-10%*
Typical Loss Factor from Rentable to Useable Square Meters

Loss Factor Notes:

*Typical loss factor from rentable to usable SF is called add-on factor. The add-on factor varies between 5-10%. Older buildings have higher add-on factor and tend to reduce it artificially.

Landlord Concessions

Fit-Out Concession

The Landlord typically provides a contribution or concession to fit-out as a part of the lease transaction.

Amount of Fit-Out Concession

€100/sm-€200/sm

Typical range of fit-out contribution.

Fit-Out Cost Notes:

Average: 150 €/sqm

Rent-Free Period

In addition to the fit-out contribution, the Landlord typically provides a contribution or concession in the form of a rent-free period.

Standard Range of Rent-Free Months

1mo.-2.5mo.

Typical number of rent-free months.

Lease Provisions

Lease Term

3yrs.-5yrs.

Typical lease term in years.

Operating Expenses & Service Charges Included

Quoted market rent typically does not include operating expenses (service charges). There are additional charges that apply to leasing space.

Additional Charges

€3/sm-€4/sm

Estimated range for all additional charges per Square Meters.

Additional Charges:

Utilities
Service Charges
Stamp Duty
Electric
Rates
HST
Cleaning
Hydro
Registration Fees
Taxes
Insurance
VAT
Other

Lease Timeline: The following apply to both office and industrial leases.

Lease Execution Requirements:

Typical upfront requirements
None for strong credit tenants
Upfront rental payment
Security deposit
Corporate guarantee
Not Applicable

Negotiated Subletting/Assignment

Typically, the tenant's right to sublease or assign the space is negotiated in the lease agreement.
Landlord Consent: Typically, the landlord's written consent IS still required.

Statutory Subletting/Assignment

This is NOT a statutory right.
Landlord Consent: The Landlord's consent is still required.

Blend & Extend Strategies

Typically, a tenant can take advantage of "blend & extend" ("forward renewal", "early renewal", etc.) strategies when the appropriate market conditions exist.

Statutory Early Termination

This is NOT a statutory termination right.

Negotiated Early Termination

It IS typical for tenants to be able to negotiate an early termination right in the lease agreement.

Early Termination Notes:

There is a possibility to terminate prior to the expiration of the initial lease term but with penalty.

Typical cost: 50-100% of the total rent

Workplace

Regional Office Space

8sm-10sm

Typical Square Meters per employee (includes office square footage for employees and contractors).

Regional HQ Office Space

10sm-20sm

Typical Square Meters per employee (includes office square footage for employees and contractors).

Prague market is typical.

Desk Sharing

Desk-sharing is a common practice in the market.

Desk Sharing Average

15%

Average headcount per workstation.

Urbanization of the workforce is: Not much of a trend in this market

Landlord Concessions

Fit-Out Concession

The Landlord typically provides a contribution or concession to fit-out as a part of the lease transaction.

Rent-Free Period

In addition to the fit-out contribution, the Landlord typically provides a contribution or concession in the form of a rent-free period.

Standard Range of Rent-Free Months

1mo.-2.5mo.

Typical number of rent-free months.

Rent-Free Notes:

Yes, but not that often

Lease Provisions

Lease Term

5yrs.-10yrs.

Typical lease term in years.

Operating Expenses & Service Charges Included

Quoted market rent typically does not include operating expenses (service charges). There are additional charges that apply to leasing space.

Additional Charges:

Utilities
Service Charges
Stamp Duty
Electric
Rates
HST
Cleaning
Hydro
Registration Fees
Taxes
Insurance
VAT
Other

Service Charge Notes:

Insurance and real estate taxes are sometimes included in service charges, sometimes paid by the tenant separately. Also a property management fee is often charged separately (3% of headline rent).

Lease Timeline: The following apply to both office and industrial leases.

Lease Execution Requirements:

Typical upfront requirements
None for strong credit tenants
Upfront rental payment
Security deposit
Corporate guarantee
Not Applicable

Negotiated Subletting/Assignment

Typically, the tenant's right to sublease or assign the space is negotiated in the lease agreement.
Landlord Consent: Typically, the landlord's written consent IS still required.

Statutory Subletting/Assignment

This is NOT a statutory right.
Landlord Consent: The Landlord's consent is still required.

Blend & Extend Strategies

Typically, a tenant can take advantage of "blend & extend" ("forward renewal", "early renewal", etc.) strategies when the appropriate market conditions exist.

Statutory Early Termination

This is NOT a statutory termination right.

Negotiated Early Termination

It IS typical for tenants to be able to negotiate an early termination right in the lease agreement.

Early Termination Notes:

There is a possibility to terminate prior to the expiration of the initial lease term but with penalty.

Typical cost: 50-100% of the total rent

Section 1. Fit Cost Data

Total Fit-Out Cost

€450/sm

Class A Office

€250/sm

Class B Office

€150/sm

Class C Office

Furniture Cost

€250/sm

Class A Office

€150/sm

Class B Office

€75/sm

Class C Office

Floor Covering Cost

€25/sm

Class A Office

€15/sm

Class B Office

Partitioning Walls Cost

€50/sm

Class A Office

€40/sm

Class B Office

€30/sm

Class C Office

Partitioning Walls Cost Notes:

37dB / 42dB / 47dB plasterboard partitions

Other (IT/etc) Cost

€300/sm

Class B Office

€170/sm

Class C Office

Other Cost Notes:

Other costs include: IT and glazed partitions (single and double glazed).

Typical Manpower Hourly Rates

€100/hr

Programme Manager

€80/hr

Senior Project Manager

€70/hr

Project Manager

€50/hr

Junior Project Manager

€50/hr

Project Assistant

€80/hr

Workplace Consultant

€80/hr

Designer/Architect

Project Management Base Fee

10%

Base fee [%] for the fitout of above office of 1000 m2.

Section 2. Scope of Work Description

Phase 1: Services Before and During the Transaction

Review the LOI and work letter portion of the Lease to ensure that the clients interests are protected during the build-out of the project.
Typically included in "Project Management" scope of work.
Advise Colliers broker and client on project issues and their resolution as they occur.
Typically included in "Project Management" scope of work.
Participate in building tours, if requested, to evaluate building systems and other cost-related observations and prepare a building due diligence report
Typically included in "Project Management" scope of work.
Develop high-level project estimate and timeline based on test fit and Client standards
Typically included in "Project Management" scope of work.
Schedule and chair Schematic Drawings and Design Development Drawings review meetings/conference calls
Typically included in "Project Management" scope of work.
Define workplace strategy for client, research what kind of location, office / work environment accelerates business
Not typically included at all, but available for an additional fee.
Define program of requirements for location, building and interior characteristics
Not typically included at all, but available for an additional fee.
Engage with the Client Facilities Management (FM) Operations team to ensure alignment with Client standards
Typically included in "Project Management" scope of work.
Phase 1 Notes:
Term for LOI is Heads of Terms (HoTs)

Define program of requirements for location, building and interior characteristics: typically carried out by the broker/agent.

Phase 2: Service Before and During the Design Process

Develop preliminary project budget and schedule.
Typically included in "Project Management" scope of work.
Develop the RFP for selection of a space planner/architect and any other consultants identified and required
Typically included in "Project Management" scope of work.
Analyze, compare and evaluate responses to the RFP.
Typically included in "Project Management" scope of work.
Orchestrate the space planner/architect interview process.
Typically included in "Project Management" scope of work.
Negotiate, on behalf of the client, professional services agreements with the space planner/architect and other consultants.
Typically included in "Project Management" scope of work.
Review architect’s final Program of Requirements.
Typically included in "Project Management" scope of work.
Monitor the design team’s schedule of deadlines and deliverables. Coordinate meetings with the design team and the client. Manage the design process on behalf of the client.
Typically included in "Project Management" scope of work.
Review and recommend payment of the invoices for services. Submit invoices for payment to landlord or client and prepare monthly reports of project costs versus project budget.
Typically included in "Project Management" scope of work.
Negotiate all client-vendor contractors (IT, AV, Security/Access Control, Signage, High Density Filing) on behalf of client.
Typically included in "Project Management" scope of work.
Coordinate with either Architect or General Contractor in permitting process
Typically included in "Project Management" scope of work.
Schedule and chair weekly design review meetings/conference calls
Typically included in "Project Management" scope of work.
Other Value-Add Services: Test fits (including Look & Feel) - Cost Estimates - Schedule/timing/phasing scenarios - Floor plan, core and circulation efficiency ratios(GIA vs NIA) (NOA vs NIA) - Technical due diligence/Assessments - We may pack everything into a Feasibility Study or proposed them separately depending on the situation.
Not typically included at all, but available for an additional fee.
Define interior guidelines for architect based on workplace strategy
Typically included in "Project Management" scope of work.
Control workplace strategy and functionality and during design process
Typically included in "Project Management" scope of work.
Architectural design
Not typically included at all, but available for an additional fee.
Phase 2 Notes:
Coordinate with either Architect or General Contractor in permitting process: The landlord carries out the fit-out works on behalf of the tenant in most office fit-out projects. We monitor their activities.

Phase 3: Services Before Construction

Liaise with the Landlord’s Representative.
Typically included in "Project Management" scope of work.
Prequalify a list of general contractors to be interviewed (consult lease to confirm any Landlord required GCs).
Not typically included at all, but available for an additional fee.
Develop the RFP, including Landlord and/or Lease required documents, for selection of a general contractor.
Not typically included at all, but available for an additional fee.
Analyze, level, and evaluate the responses to RFP.
Not typically included at all, but available for an additional fee.
Orchestrate general contractor interview process and prepare evaluation scorecard.
Not typically included at all, but available for an additional fee.
Review all proposed subcontractors and monitor the general contractor’s subcontractor bid process to ensure integrity of the process and quality of the workmanship.
Not typically included at all, but available for an additional fee.
Monitor the general contractor’s schedule of deadlines and deliverables. Coordinate meetings between the design team, general contractor, client and appropriate vendors.
Typically included in "Project Management" scope of work.
Schedule and coordinate Architect's 90% Construction Drawings review
Typically included in "Project Management" scope of work.
Develop Project Cost Summary + Invoice Tracker and update weekly
Typically included in "Project Management" scope of work.
Phase 3 Notes:
The landlord carries out the fit-out works on behalf of the tenant in most office fit-out projects. We monitor their activities.

Other invoices are one-off payments for AV / furniture / etc. We provide weekly project updates that include everything in the form of minutes following a conference call -- can be an actual report but not typically.

Phase 4: Services During Construction

Coordinate with the Landlord’s Representative.
Typically included in "Project Management" scope of work.
Conduct weekly construction meetings to assess progress, quality and conformance with the Contract Documents and distribute minutes of meetings.
Typically included in "Project Management" scope of work.
Monitor the general contractor’s schedule.
Typically included in "Project Management" scope of work.
Monitor the construction budget.
Typically included in "Project Management" scope of work.
Review, and recommend for payment, the contractor’s Applications for Payment.
Not typically included at all, but available for an additional fee.
Monitor all project documentation.
Typically included in "Project Management" scope of work.
Act at all times as client’s liaison to vendors contracted directly by Client (IT, AV, Security/Access Control, Signage).
Typically included in "Project Management" scope of work.
Oversee the punch list process to ensure acceptable completion of all items.
Typically included in "Project Management" scope of work.
Close out all consultant, contractor and vendor contracts.
Typically included in "Project Management" scope of work.
Review and recommend for payment all General Contractor, vendor, and consultant invoices; submit to Client for approval
Typically included in "Project Management" scope of work.
Deliver close-out documents, as specified in the Lease, to Client
Typically included in "Project Management" scope of work.
Coordinate value/engineering process, if required.
Typically included in "Project Management" scope of work.
Provide as-built drawings and O&M Manuals to Client FM Operations team
Typically included in "Project Management" scope of work.
Phase 4 Notes:
The landlord carries out the fit-out works on behalf of the tenant in most office fit-out projects. We monitor their activities.

Deliver close-out documents, as specified in the Lease, to Client: Physical information provided by the landlord.

Provide as-built drawings and O&M Manuals to Client FM Operations team: Physical information provided by the landlord.

Additional Services: Services During Relocation

Develop RFP for moving companies, evaluate responses and recommend selection of moving company or identify, interview and review proposal for services from relocation consultants.
Not typically included at all, but available for an additional fee.
Represent Client in development of move strategy.
Not typically included at all, but available for an additional fee.
Monitor development of move activity checklist.
Not typically included at all, but available for an additional fee.
Represent client on site during move process.
Not typically included at all, but available for an additional fee.

Additional Services: Project Management Services Related to Furniture/Workstation Procurement

Conduct bid process for all furniture (workstations, case goods, seating, filing) purchases specified by the architect and/or client.
Typically included in "Project Management" scope of work.
Conduct bid process for refurbishment of existing furniture and/or workstations.
Not typically included at all, but available for an additional fee.
Evaluate bids and negotiate purchase order with manufacturer(s).
Typically included in "Project Management" scope of work.
Change management before, during and after moving to the new work environment
Not typically included at all, but available for an additional fee.
Measuring/monitoring (KPI's) how the way of working and building accelerates business and goals of the client
Not typically included at all, but available for an additional fee.

Business Climate Business Climate data provided in partnership with Hickey & Associates. Rankings reported on a scale of 1 (least favorable) to 10 (most favorable). Please refer to the full report Explore 2017 for additional details.

Incentives and Labor Market

2, 8 2/10

Incentives
Value potential, diversity/number of programs

6, 4 6/10

Job Saturation
Competition for workers

3, 7 3/10

Wage Inflation
Rise in wages (past 10 years, local currency)

Educational Attainment

6, 4 6/10

HS Ed Eq
Proportion of population attaining this level

6, 4 6/10

University Ed
Proportion of population attaining this level

6, 4 6/10

Overall
Composite average of HS Ed Eq & University

Composite

4, 6 4/10

Additive sum of incentives, saturation, overall ed attainment, and wage inflation

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