La Defense remains a prime office location in Paris with the densest concentration of office space in France, but obsolescence of existing buildings is a growing problem, Olivier de Molliens, deputy CEO of Paris-based Colliers International Keops, told the PropertyEU France Investment Briefing in London last week.
La Defense remains a prime office location in Paris with the densest concentration of office space in France, but obsolescence of existing buildings is a growing problem, Olivier de Molliens, deputy CEO of Paris-based Colliers International Keops, told the PropertyEU France Investment Briefing in London last week.
‘Many buildings date from the 1970s and face green building legislation. It will be a challenge to refurbish them and put them back on the market,’ he noted.
Moreover, rental prices are relatively high in La Defense compared to the Paris Central Business District, he added. ‘A few years ago, rents were less than EUR 400 per m2 in La Defense. But we’ve seen some strong increases and now they’re about EUR 600 per m2. This compares to EUR 700-750 m2 in Paris CBD.’
De Molliens said further rental increases in La Defense were unlikely for the coming period and that rent reductions were on the cards, in particular for offices with high vacancy rates. The prospects for Paris CBD look brighter with vacancy rates at just 4.5%. This compares to 7% for the greater Paris regions.
