Office - Q4 2024
New office completions surged in H2 2024, with 76,000 sq m added across Sweden’s largest cities, a 146% increase from last year. Gothenburg led with 58,000 sq m, while Stockholm and Malmö saw lower activity. Vacancy rates have risen slightly, reaching 8.0% in Stockholm CBD, 13.0% in Gothenburg, and 7.5% in Malmö. Despite this, prime rents continue to grow, with Stockholm reaching SEK 9,650/sq m, while prime yields declined slightly in Stockholm and Gothenburg.
Office - Stockholm - Q4 2024
Office completions in Stockholm slowed in H2 2024, with just 3,000 sq m delivered and none in Q4. Vacancy rates increased to 16.5% across Greater Stockholm, with decentralised areas seeing the largest rise. Prime rents in the CBD rose to SEK 9,650/sq m, while rents in the City Centre and decentralised areas remained stable. Prime yields decreased slightly to 3.95% in the CBD and 4.35% in the City Centre, while decentralised yields stayed at 4.65%.
Logistics - Q1 2025
About 150,000 sq m of newly developed logistics space was completed during Q1 2025, with almost 70% fully let. The forecast for 2025 indicates a significant decrease in new completions compared to 2024, with an estimated 0.4 million sq m, approximately 70% lower than the 1.4 million sq m completed in 2024. QoQ vacancies increased in Stockholm to 14.0% and regional cities to 9.5%, while decreases were recorded in Gothenburg and Öresund, dropping to 6.0% and 6.5%, respectively. Overall country-level vacancies extended to 9.0%. Prime yields in major regions remain stable, whilst prime rents saw increases across Sweden.
Residential - Q1 2025
The residential sector was the second most active segment of the investment market in Q1 2025, with an investment volume of SEK 7.3 billion, a 24% increase compared to Q1 2024, representing 20% of the total transaction volume. Prime yields in major cities continued to decrease slightly during Q1, now at 4.00% in Stockholm, 4.50% in Gothenburg, and 4.65% in Malmö, while regulated rents remained stable. Construction starts in Q3 2024 amounted to approximately 1,527 apartments in Greater Stockholm, Greater Gothenburg, and Greater Malmö, a 42% decrease YoY. Despite this decline, the overall trend for 2024 shows signs of recovery due to normalized construction costs, lower inflation, and reduced interest rates. Increased liquidity in the investment market remains a positive factor, potentially leading to a rebound in construction activity in subsequent quarters.
Retail - Q1 2025
The National Institute of Economic Research forecasts that Sweden's economic recovery will be postponed into next year due to dampened economic activity. Inflation is expected to decrease later this year and fall just below the target next year, allowing households to regain confidence and increase consumption and support economic recovery. Prime rents for high street properties and shopping centers have remained stable, while prime rents for retail parks increased in Q1 2025, driven by resilient tenants like supermarkets and discount stores. Retail investment volume in Q1 amounted to SEK 2.3 billion, representing 6% of the total transaction volume, with prime yields for high street assets and shopping centers remaining stable. Retail sales volume continued slow growth in February, with YoY increases of 2.7% for total retail sales, 1.8% for non-durables, and 4.1% for durables.
Economic & Investment Overview - Q1 2025
Sweden's economic recovery is expected to be delayed into next year due to geopolitical and trade policy uncertainties, impacting both domestic and international activity. Swedish export growth will be subdued in 2025, and unemployment will remain elevated even at the end of 2026. CPIF inflation is anticipated to decrease later this year, and the Riksbank is unlikely to change the policy rate until late 2026. Investor activity in Q1 showed a strong start with a transaction volume of SEK 36.8 billion, a 56% increase compared to the same period last year, dominated by domestic investors. Although office sector investment volume decreased in Q1 2025 compared to Q4 2024, it encompassed about 24% of the total transaction volume. Prime yields in office, retail, and logistics segments remained stable, while residential prime yields saw minor compression to 4.00%.
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