Share: Share on Facebook Share on Twitter Share on LinkedIn I recommend visiting to read:%0A%0A {0} %0A%0A {1} Share on Xing

The slump in major lettings in prime German office locations continues; Prime rents continue to rise

Verena Bauer • 08/04/2024

In the 1st quarter of 2024, office take-up in Germany’s five most important office locations was on a par with the previous year at around 511,000 sq m, according to figures from international real estate consultancy firm Cushman & Wakefield (C&W). Subdued demand for space with increasing supply from vacancy and completions as well as rising rents continue to characterise market activity. 

Christian Lanfer, Head of Office Agency Germany at C&W, comments: “On the user side, we continue to observe a high demand for top quality in conjunction with high completion figures. However, the number of construction starts is falling: speculative construction is scarcely feasible in the current restrictive financing environment and pre-letting targets are inching ever higher. For larger office occupants, there are now internal lead times of up to two years for leasing decisions. If development projects are then included, the total process duration can easily exceed six years.”

Helge Zahrnt, Head of Research & Insight Germany at C&W, adds: “The first quarter is usually the weakest in terms of take-up, and 2024 is proving to be no exception. Due to the current state of the economy and a less than optimistic forecast for the coming months, higher take-up is currently not to be expected. In addition, many occupiers are thinking about structural space reductions or are already implementing them: For the year as a whole, we expect a result similar to 2023.”

Take-up: Corridor of -25 and +25 percent compared to Q1 2023

  • In the top-5 office markets, around 511,000 sq m of office space was let or assigned to owner-occupiers in Q1 2024. This is on a par with the prior-year quarter, but 6 percent below the previous quarter. 
  • As in recent quarters, market activity is below average: both the Q1 10-year average and the average of the past ten quarters were undershot by more than 20 percent in Q1 2024. 
  • Berlin and Munich, with almost 140,000 sq m each, are the market areas with the highest take-up. Berlin equalled the level of the previous year, while Munich achieved an increase of almost a quarter. The sharpest year-on-year decline, by 25 percent, was recorded in Hamburg. 
  • At around 630, the number of transactions in Q1 2024 is stable compared to the previous quarter and Q1 2023. 
  • In the first quarter of 2024, there were only five deals in the size class of 10,000 sq m or more, two each in Berlin and Munich, however the largest letting, of 38,000 sq m by the ECB, took place in Frank-furt and also marked the largest deal in the top-5 since Q2 2022. Smaller deals of less than 1,000 sq m, on the other hand, are performing much better – exhibiting an increase of 4 percent compared to the previous quarter. 
  • Around 62 percent of take-up in the 1st quarter was recorded in CBD and central locations, i.e. those locations that are particularly at the focus of users’ attention regarding the “flight-to-quality”. In the CBD alone, there was an increase from 19 to 33 percent compared to the previous quarter – three of the five major deals of 10,000 sq m or more are in this location category.
  • In terms of occupier sector, industrial companies lead ahead of public administration. The ICT industry, which regularly topped the rankings until 2022, was only in fourth place in the quarter under review. 

Chart Take-up 2024 Q1


Rental prices: Prime rents with further upward momentum

  • In the 1st quarter, prime rents rose in Munich (EUR +3.00 /sq m), Düsseldorf (EUR +2.00/sq m) and Frankfurt (EUR +0.50/sq m). On average in the top-5 markets, prime rent growth was 2.5 percent quar-ter-on-quarter and 6.2 percent year-on-year. 
  • When it comes to average rents, for which the lettings of the past twelve months are taken into ac-count, the picture is mixed. In some markets there is an increase (Frankfurt >EUR 2.00/sq m and Mu-nich >EUR 1.00/sq m), in others a decrease (Berlin and Düsseldorf by EUR 0.25/sq m each).
  • The rent-free periods in central prime locations are 7.5 percent based on a 5-year lease across all top-5 markets. 

Chart Prime Rent 2024 Q1


Vacancy: More vacancy, especially for subletting space

  • The vacancy rate for office space in the top-5 market areas stood at 5.68 million sq m at the end of Q1 2024. This corresponds to a vacancy rate of 7.2 percent and is one percentage point higher than twelve months ago. 
  • Among the top-5 markets, Hamburg continues to have the lowest rate at 4.8 percent, while Düsseldorf has the highest rate at 10.2 percent. Berlin has the absolute highest vacancy rate (1.57 million sq m), followed by Munich (1.3 million sq m).
  • The supply of subletting space continued to increase in Q1, totalling 653,000 sq m, which is 35 percent higher than the figure of a year previously. The classical vacancy rate (excluding subletting space) has risen by 17 percent.
  • In the coming quarters, C&W expects the vacancy rate to rise further – to around 8.0 percent by the end of 2024, due to the unlet space in the numerous completions as well as space reductions when many occupiers move. 

Chart Vacancy Rate 2024 Q1


 Completions: Construction volume decreases

  • In the first quarter, 331,000 sq m of office space was completed, 69 percent of which was let or assigned to owner-occupiers on completion. By far the largest volume of completions was in Berlin (206,000 sq m), followed by Munich (54,000 sq m). 
  • Around 1.73 million sq m of property currently under construction is for completion by the end of 2024 – which would be almost double the 5-year average (960,000 sq m). Currently, 41 percent of this space is still available. 
  • At the end of the 1st quarter, the construction volume was 3.3 million sq m – about half of which is still to be let. Compared to the previous quarter, construction volume fell by around 310,000 sq m, as fewer new construction projects are being launched in the current market environment. 


verena bauer
Verena Bauer

Head of Business Development Services, Germany • 60311 Frankfurt am Main


Press Release Cushman & Wakefield
Clemens von Arnim takes on the additional role of Regional Manager East in Germany

Cushman & Wakefield has appointed Clemens von Arnim as Regional Manager for the Eastern Region in addition to leading the Capital Markets Berlin division. His appointment was made as part of the company’s recently completed repositioning on the German market.

Verena Bauer • 13/06/2024

Germany Flex Office Market  - Cushman & Wakefield
Flex Office Market Germany shows resilience

The German flex office market remains attractive, despite a structural change in demand in which office users are increasingly favouring smaller spaces with higher quality.

Verena Bauer • 06/06/2024

Press Release Cushman & Wakefield
Strategic repositioning of the German business

Cushman & Wakefield is setting the course for even greater client focus in Germany with a new organisational model.

Verena Bauer • 28/05/2024


Office Fit Out Cost Guide - Web card
Insights • Workplace

Germany Office Fit Out Cost Guide

Utilize our Office Fit Out Cost Guide 2024 to effectively plan and budget your office evolution in Germany. Start transforming your workspace in cities like Berlin, Frankfurt, and Munich today!
Cushman & Wakefield Asset Optimisation Guides

Complete Asset Optimisation Guide

Our asset optimisation whitepapers serve as your comprehensive guide through the multifaceted real estate landscape.
Verena Bauer • 05/03/2024
City Logistics

European City Logistics Reports

Cities – and city logistics – continue to evolve in the post-pandemic environment. And with them, city logistics real estate strategies are also evolving.
Verena Bauer • 07/02/2024


Get in touch with one of our professionals.
With your permission we and our partners would like to use cookies in order to access and record information and process personal data, such as unique identifiers and standard information sent by a device to ensure our website performs as expected, to develop and improve our products, and for advertising and insight purposes.

Alternatively click on More Options and select your preferences before providing or refusing consent. Some processing of your personal data may not require your consent, but you have a right to object to such processing.

You can change your preferences at any time by returning to this site or clicking on Cookies.
These cookies ensure that our website performs as expected, for example website traffic load is balanced across our servers to prevent our website from crashing during particularly high usage.
These cookies allow our website to remember choices you make (such as your user name, language or the region you are in) and provide enhanced features. These cookies do not gather any information about you that could be used for advertising or remember where you have been on the internet.
These cookies allow us to work with our marketing partners to understand which ads or links you have clicked on before arriving on our website or to help us make our advertising more relevant to you.
Agree All
Reject All