MOSCOW-Vacancy rates in Moscow’s office sector dropped to 15% insecond quarter 2010 from 19.6% in the fourth quarter 2009, buoyedby demand for quality space, Jones Lang LaSalle reports.

JLL board member Andrey Postnikov said he believes the declinecould signal a stronger market. “After 2010, we expect the supplypipeline to slow considerably, while absorption will continue togrow. We expect a slight correction with vacancy rates edgingtowards 15.5%-16% over the next two quarters, but after that thefigures will decrease,” he said.

The frozen pipeline during the economic slowdown was expected toconstrict supply in 2011. But pressure on vacancy rates has alreadybegun, due to a sudden increase in demand from both state andprivate entities in Russia and abroad. Important second-quarterdeals included RusHydro’s purchase of an office building on MalayaDmitrovka Street.