In 2009 approximately 2 million m[sup]2[/sup] of office space was leased in the five major German office markets of Berlin, Düsseldorf, Frankfurt, Hamburg and Munich, according to a report by the German subsidiary of real estate adviser Savills. This corresponds to a reduction of 29% when compared to 2008. As a result, 2009 was one of the weakest years in the past decade in terms of take-up of office space, surpassed only by 2003 with a comparably low result.
In 2009 approximately 2 million m2 of office space was leased in the five major German office markets of Berlin, Düsseldorf, Frankfurt, Hamburg and Munich, according to a report by the German subsidiary of real estate adviser Savills. This corresponds to a reduction of 29% when compared to 2008. As a result, 2009 was one of the weakest years in the past decade in terms of take-up of office space, surpassed only by 2003 with a comparably low result.
Rental levels also fell in all of the researched markets, with both prime and average rents ending the year at a lower leverl than in 2008. Only in Düsseldorf did nominal rents remain relatively stable over the year. However, the city reported the sharpest decline in terms of take-up which fell 53%, followed by Munich (- 33%), Frankfurt (- 29%) and Hamburg (- 26%). As predicted, Berlin was the strongest market with take-up falling by only 19%. Following new office completions during 2009, vacancies climbed in all markets to an average 10% or a total of 6.4 million m2. The only exception was Berlin.
'Market conditions will remain challenging in 2010,' predicted Daniel J. Gedack, managing director responsible for office agency at Savills Germany. 'Companies looking for office accommodation are hesitant in taking decisions and have become increasingly price-sensitive. Experience shows that it takes quite a number of months for the office market to respond to the effects of the national economy so we expect another year of below-average letting performance and increasing vacancies.'
