Real Estate in Denmark
The office occupier market has seen a shift from very high activity and historically low vacancies to a more slowed pace, where businesses are reconsidering their office spaces to attract employees. Tenants are gaining bargaining power, setting demands for lease contracts to be more flexible. Although economic uncertainties impact the occupier market negatively, the office occupier market in Copenhagen is still very strong, with stable rent levels and only slightly increasing vacancy rates. With a focus on prime, we expect to see a widening gap between primary and secondary rent levels.
The Danish economy has for a long time shown stable growth across the board with rising employment, modest inflation, low interest rates, and healthy GDP development. The Danish economy is doing well in a European context, and many foreign investors perceived Denmark as a safe haven for commercial real estate investments due to the political and financial stability and the lucrative mortgage opportunities. Due to the stable political system, the World Bank has ranked Denmark as either the most or the second most business-friendly country in Europe since they introduced their "Ease of Doing Business" ranking in 2005. The list ranks 190 economies according to how good the regulatory conditions are for running and starting a local business. In 2020, Denmark was ranked the most business-friendly country in Europe and the fourth most business-friendly country globally.