Chart of the month November: Top offices are still in demand
Office vacancies are increasing in the seven class A cities. According to classic economic theory, rents should therefore be falling. But our quarterly figures show: Prime rents are still rising.
In RIWIS aktualisieren wir quartalsweise unsere Daten zu den Büromärkten. Inmitten der Krise, die ja auch stark den Büromarkt trifft, haben wir für das Magazin eine kleine, optimistisch stimmende Auswertung gemacht.
In RIWIS, we update our data on the office markets on a quarterly basis. In the midst of the crisis, which is also hitting the office market hard, we have produced a small, optimistic analysis for the magazine. Despite rising vacancy rates in the A markets, prime rents are still increasing. Small, high-priced office space in the top locations of the seven German A cities is currently enjoying great popularity among users. Why? Good properties in central locations increasingly represent a success factor in the competition for highly qualified employees. Companies are prepared to pay the high prices.
Looking back to the pre-coronavirus year of 2019, it is striking that prime rents have not fallen significantly in any German A-city since then. On the contrary, they have actually risen significantly; there were only brief stagnations due to the pandemic. The biggest increases over the four years under review here are in Düsseldorf and Cologne (both up by more than 36 %), whereas prime rents in Frankfurt have "only" risen by around 9.8 %.
Why do Munich, Frankfurt and Berlin in particular stand out from the other cities with high prime office rents? Munich is home to six DAX companies and numerous other large corporations. Frankfurt is a major European financial center with numerous high-priced skyscrapers. As the capital, Berlin is a must for many companies, authorities, embassies and start-ups.
Important to know: The prime rent of the office market covers the top price segment with a market share of three percent of rental turnover and represents the median rent. It includes properties in top locations, with the best fittings and in top condition.
Contact person: Alexander Fieback, Division Manager Office Real Estate at bulwiengesa, fieback@bulwiengesa.de.
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