Office Market Overview - Big 7 | 4th quarter 2018 January 2019 - JLL
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Office Market Overview Big 7 | 4th quarter 2018 January 2019
Space take-up declines in the office property
markets of the Big 7 cities – rents rise further
Business sentiment deteriorated towards the end of 2018. for the German economy. According to Consensus Forecast
The ifo business climate index fell for the third time in suc- estimates, the gross domestic product grew by 1.8% in real
cession at the end of November, albeit from a high level. terms during 2018, which is slightly lower than in the previ-
Companies were more pessimistic both about their current ous two years. A marginally reduced growth rate of 1.6% is
position and future expectations. Yet leading economic and also expected for 2019. However, the employment market
financial institutions are still forecasting a sustained up- continues to send out positive signals in defiance of the
ward trend for 2019. As things stand, not a single institution sluggish economic situation. In 2018, 44.8 million people
anticipates the onset of a recession this year, even though were in active employment in Germany, meaning that the
economic growth may not be as strong as before because number of people with a job reached the record level that
of increasing risk factors and cooling effects. was achieved in 1991 following Germany’s reunification.
At the same time, export-oriented companies in particular According to preliminary figures, this positive development
are following developments closely, and with a certain is owing to higher employment levels among the domestic
degree of nervousness, on the other side of the Channel in population as well as the inflow of foreign workers. Compa-
London and across the pond in Washington DC. A no-deal red to 2017, employee figures increased by 562,000 people
Brexit scenario and an increase in import duties following a or 1.3%. Overall, the 13-year rise in employment continues
further deterioration in the trade dispute between the USA unabated, with the service sector proving to be particularly
and China represent the two most dangerous flashpoints effective at creating new jobs.
Completions and Vacancy Rate Big 7
vv
Vacancy
-916,000 sqm
compared to last year
Office Market Overview | 4th quarter 2018 2space. This correlation is also evident from the increased
net absorption, which last year amounted to 1.2 million
sqm in aggregate for the Big 7. As well as being 10% higher
than in the previous year, this figure also represents the
highest level of the last five years — which is despite the
more efficient use of space in new lettings with correspon-
dingly less space per workplace.
Looking ahead to 2019, a further reduction in office space
take-up can be expected, again primarily because of the
short supply of available space. However, an additional fall
Office space-take up decreases, but remains in demand may occur over the year as a consequence of a
at a high level further economic slowdown. We can only talk about this in
Demand by companies for office space also remains at a the conditional tense given the current unstable and uncer-
high level because of the rising employment figures. In tain economic outlook. However, we are certain that take-
2018 as a whole, office space take-up in the Big 7 reached up by the end of 2019 will remain at a high level in a histori-
close to 4 million sqm. This puts 2018 in second place be- cal context. With regard to the individual markets, take-up
hind 2017 in the all-time statistics, although take-up last fell in six of the seven property strongholds. Düsseldorf was
year fell by only a moderate level of 6.5%. It’s also impor- the only market to register an increase compared to 2017,
tant to put this into perspective: Given the fact that em- with take-up rising 6% to 415,000 sqm. However, Munich
ployment levels are rising, the decrease in take-up is not and Berlin again generated the highest take-up volumes in
to be attributed to flagging expansion efforts or a lack of 2018. The Bavarian capital once again only just failed to
enthusiasm on the part of companies to relocate. It’s more reach the 1-million-sqm mark in 2018, recording a fairly
the case that some planned relocations were not possible moderate decline of 2% to 975,000 sqm compared to 2017.
to realise because of the unavailability of suitable office Berlin registered a somewhat heftier decline, with take-up
Prime Rental Index and Take-up Big 7
v
Prime Rent Q4 2018
compared to last year
+6.4 %
Office Market Overview | 4th quarter 2018 3falling almost 11% year-on-year to almost 842,000 sqm. the rate in Stuttgart was only marginally higher at 2.2%.
However, Stuttgart recorded the sharpest decrease of Meanwhile the vacancy rate has fallen below 3% in Munich
almost 16%. It is certainly no coincidence that Stuttgart and below 4% in Hamburg. The shortage of space in some
and Berlin have the lowest vacancy rates. Thus it must be sub-markets has for some time acted as a major obstacle
stressed that the decline in take-up is not attributable to to business development. In six sub-markets in Munich and
sluggish interest by companies in rental opportunities, three in each of Berlin and Stuttgart, the vacancy rates are
but to the short supply of space. now well below 1% in some areas. There have already been
severe shortages in some instances, and this raises the
Increased market significance of flexible question as to whether vacancies can fall any further.
office space providers, but falling vacancies Taking into account current completion figures for 2019,
prevent stronger expansion we predict that the rates will decrease slightly again in the
As was already evident in the previous year, providers of current year, falling to 3.5% on aggregate. However, there
flexible office work spaces have themselves become major are signs of a change of direction in the medium term, and
consumers of office space, and continued to expand their we even expect to see a slight increase in vacancies in
presence in 2018. This sector again accounted for a 6% Stuttgart and Munich.
share of total space take-up, although in prime locations
(CBD) its share was as much as 16%. However, the lack of Completions increase only moderately and
space in top locations also hampers the expansion plans planned developments are delayed
of such providers. If the supply of space had been greater, Office completions in 2018 increased by almost 8% to
take-up would have been much higher. 927,000 sqm compared to 2017. Munich and Berlin accoun-
Needless to say, the problem of diminishing vacancies ted for the highest volumes of almost 300,000 sqm and
affected all companies and industries last year and was a 147,000 sqm respectively. The new-building volume should
recurring theme throughout the year. The vacancy rate in by rights increase significantly again in the next two years,
the Big 7 stood at 3.6% by the end of the year and was 1.1 but latest evaluations show that projects will once more be
percentage points lower than at the end of 2017. In each of significantly delayed. Thus only 1.68 million sqm of newly
the Big 7 cities, the volume of vacancies fell by a double- built space is expected for 2019 (instead of the 1.8 million
digit rate in a 12-month comparison, with Berlin and Cologne sqm that was still being predicted in the autumn), and the
registering the most substantial declines. In Berlin, the projected volume for 2020 has also fallen by around
vacancy rate was at just 2% by the end of December, while 200,000 sqm to almost 2.1 million sqm.
Considering the low vacancy rates, this should be the time
for project developers to act. But the high capacity utilisation
of the construction industry and the relentless increase in
development and construction costs prevent planned pro-
jects from being realised. And when new spaces are com-
pleted, it is often the case that they have already been
snapped up by future tenants.
Office Market Overview | 4th quarter 2018 4For example, of the 1.68 million sqm expected to be com- And by the end of the year, it could be that Munich will have
pleted this year, only 481,000 sqm (29%) is still available. replaced Frankfurt as the most expensive office market in
For 2020, around 60% is currently still available to potential terms of rents.
tenants. Should the strong demand continue in the coming Rental rises in secondary locations even outpaced growth
weeks and months, it is nevertheless likely that this propor- in the more central areas of the cities, where prime rents
tion of available space will be quickly reduced. are traditionally generated. In the last five years, much
stronger growth of 23% and 26% was generated in secon-
Rental prices have risen sharply, and are dary and tertiary locations respectively compared to the
expected to grow further prime locations, although this was from a much lower star-
The long-standing imbalance between demand and the ting point. Nonetheless, this analysis shows that sub-mar-
supply of space, whereby demand considerably outweighs kets outside the prime sites provide attractive alternatives
supply, has been driving up rental prices in the Big 7 since for office users.
2010. In 2018 alone, the increase in the aggregated rent
across the Big 7 cities amounted to 6.4%, and all seven
German property strongholds experienced rental growth.
In a 12-month comparison, the strongest increases took
place in Berlin (+13.3%) and Cologne (+6.8%). Rents will
continue to grow in 2019, albeit at a slower rate (3.5%).
Office Space Take-up incl. Owner Occupier (sqm)
2017 2018 Trend prognosis 8
Berlin 1 944,800 841,700
Düsseldorf 2 390,600 415,000
Frankfurt/M 3
711,300 633,300 è
Hamburg 4 640,000 580,000 è
Cologne 5 306,900 305,200 è
Munich Region 6 995,000 975,000 è
Stuttgart 7
254,700 215,300 â
Total 4,243,300 3,965,500
Office Market Overview | 4th quarter 2018 5Vacancy incl. Space for subletting
Q4 2017 Q4 2018
Trend prognosis 8
sqm Rate (%) sqm Rate (%)
Berlin 1 701,300 3.5 402,400 2.0 â
Düsseldorf 2 720,200 7.9 630,500 6.9 è
Frankfurt/M 3
886,600 7.6 727,200 6.3 è
Hamburg 4 712,800 4.8 580,400 3.9 è
Cologne 5 315,000 4.1 251,000 3.3 è
Munich Region 6 731,300 3.6 599,600 2.9
Stuttgart 7
236,300 2.7 196,100 2.2
Prime Office Rents (€/sqm/month)
Q4 2017 Q4 2018 Trend prognosis 8
Berlin 1 30.00 34.00
Düsseldorf 2
27.00 28.00
Frankfurt/M 3 38.00 40.00
Hamburg 4
26.50 28.00
Cologne 5 22.00 23.50 â
Munich Region 6 37.00 39.00
Stuttgart 7 22.50 23.50
Completions (in sqm)
2017 2018 Trend prognosis 8
Berlin 1 109,000 146,900
Düsseldorf 2 112,000 91,800
Frankfurt/M 3
89,800 88,200
Hamburg 4 181,600 145,000
Cologne 5 68,700 89,800
Munich Region 6 195,200 290,500
Stuttgart 7 103,400 75,200
Office Space Stock (in Mill. sqm)
Q4 2017 Q4 2018
Berlin 1
20.23 20.26
Düsseldorf 2
9.13 9.18
Frankfurt/M 3 11.70 11.58
Hamburg 4 14.90 14.99
Cologne 5 7.69 7.71
Munich Region 6
20.24 20.39
Stuttgart 7 8.65 8.72
1
City Area; 2 City Area incl. Ratingen, Neuss, Erkrath and Hilden; 3 City Area incl. Eschborn and Kaiserlei; 4 City Area; 5 City Area; 6 City Area incl. surrounding areas;
7
City Area incl. Leinfelden-Echterdingen; ⁸ 2019 compared to prior year
Office Market Overview | 4th quarter 2018 6Berlin
Development of Main Indicators
High level of take-up in the final quarter –
vacancy rate now at 2%
The full-year take-up of 841,700 sqm in the Berlin office
letting market was in excess of the 5-year average, despite
the acute scarcity of available space in the German capital.
The fourth quarter contributed almost 30% of the total
transaction volume. This performance is due in part to
the letting of almost 13,000 sqm in Grand Central in the
Europacity submarket to Immobilien Scout and almost
10,000 sqm in the Brighter Hub in the Mediaspree submar-
ket to the co-working provider WeWork. In total, there were end of 2018, the prime office rent is likely to reach €36.00/
seven large-scale lettings of areas in excess of 10,000 sqm, sqm/month by the end of 2019. Some hope is provided by
equating to a share of 13%. This is a remarkable result the increasing number of new-build completions up to
given the increasing scarcity, as the vacancy rate in the top 2022. There is currently almost 1.2 million sqm space under
submarkets is below 1% and therefore practically non-exis- construction, although most of this is already prelet. This
tent in some locations. Office tenants are increasingly focu- new space coming onto the market will give prospective
sing on the submarkets outside the city centre. As a result, tenants a greater degree of latitude in future.
after the remarkable 4.6% rise to €34.00/sqm/month at the
Berlin: Office Space Market Areas with Rental Bands (€/sqm/month)
Berlin: Office Space Market Areas with Rental Bands (€/sqm/month) JLL Research 2018/Q4
Wedding Wedding Gesundbrunnen
Klar aho eh
Tiergarten A114
Area Main Station-Europacity
Prenzlauer
€ 22.00 - 34.00 A10
Berg
Kon rad sh Malcho w(H oh en sch Moabit
Tegeler See
Charlottenburg Reinickendorf A111 Northern Suburb
€ 8.50 - 18.00
Charlottenburg 1A Pankow Mitte
€ 20.00 - 34.00 Schöneberg A105
Hansaviertel
Mitte 1A
€ 22.00 - 34.00
Falken see Berlin-Tegel
Wilmersdorf
Tiergarten
Lichtenberg
Area Potsdamer-Leipziger Platz
Mitte € 24.00 - 34.00
€ 20.00 - 30.00 Prenzlauer Kreuzberg
Mitte
Berg-Friedrichshain Schöneberg
Spandau € 16.00 - 26.00 Marzahn-Hellersdorf
Charlottenburg-Tiergarten
Western Suburb Friedrichshain-Kreuzberg
€ 14.00 - 25.00
€ 10.00 - 17.00
A100 Mediaspree Eastern Suburb
Charlottenburg-Wilmersdorf € 22.00 - 33.00 € 10.00 - 16.00
Ber lin
Altglienicke
Wilmersdorf-Schöneberg
Groß Havel
€ 14.00 - 28.00
Glienicke
Großziethen Kreuzberg-Tempelhof
Bohnsdorf
Schönefeld
€ 15.00 - 28.00
Berlin-Schönefeld
Kienberg
Gatow
Berlin-Schönefeld
Waßmannsdorf
Waltersdorf Tempelhof-Schöneberg
A103
Selchow
A113 Neukölln
A115
Kiekebusch Treptow-Köpenick
Glasow Rotberg
Area Airport Berlin- Southern Suburb
Klad ow
Blankenfelde
Brandenburg € 8.50 - 18.50 Steglitz-Zehlendorf € 10.00 - 18.00 Großer
A113
Groß Kienitz A10 Adlershof Müggelsee
Die
Dahlewitz Breite E55 € 10.00 - 16.50
Brusendorf
Klein Kienitz A13
Office Market Overview | 4th quarter 2018 BerlinDüsseldorf
Development of Main Indicators
Prime rent climbs to all-time high
The total take-up in the Düsseldorf office letting market in
2018 was 415,000 sqm, of which around 355,000 sqm was
in the Düsseldorf city area. This equates to an increase of
6% compared to the previous year and is 9% above the
10-year average. The fourth quarter was comparatively
weak with take-up of around 85,000 sqm, but this is be-
cause several large-scale enquiries in the >10,000 sqm size
category have been delayed until 2019. We expect a full-
year take-up of around 450,000 sqm in 2019. The largest let-
ting of 2018, of around 35,500 sqm in the North submarket, tings of 21,000 sqm to flexible office space providers. The
was concluded with Deloitte GmbH in the second quarter. vacancy rate has fallen continually over the course of the
The most popular submarket was again the City Centre, year, from 8.0% in the first quarter to its current level of
where one in every five new leases was concluded. The 6.9%, and this is expected to continue to fall in 2019. The
largest letting here was to NRW.Bank, which signed a new vacancy rate in the city area is just 5.9%. The prime rent is
lease for 7,700 sqm in the Herzogterrassen. The most active achieved in the CBD and the level of €28.00/sqm/month
sector in terms of take-up was business services providers, at year-end 2018 is a new all-time high.
which accounted for a share of almost 35%, including let-
Düsseldorf: Office Space Market Areas with Rental Bands (€/sqm/month)
Düsseldorf: Office Space Market Areas with Rental Bands (€/sqm/month) JLL Research 2018/Q4
Lank-L atu m Lang stkierst
Fischeln Kalkum Pempelfort
Kalkum
Roh den hau s
Kaiserswerth
Ratin gen
Ilverich Altstadt
Oberkassel
Stru em p Airport
Ratingen
€ 11.00 - 16.50 CBD Düsseldorf
A44 Lichtenbroich € 8.00 - 15.50
Carlstadt € 16.00 - 28.00 Nied erschwar zbach
Lohausen
Düsseldorf
Rhein
City € 9.00
Unterrath - 26.00
Stadtmitte
Rath Hafen Government District
Knittkuhl € 11.50 - 20.00
Stockum
North Unterbilk
Metzkau sen
Rhein € 8.00 - 16.50 Friedrichstadt
Derendorf City-South € Oberbilk
Seestern Mörsenbroich Lu den berg 8.00 - 11.00
Hubbelrath
€ 9.50 - 13.50 Ludenberg
Lörick Golzheim Bilk
Meerb usch Kennedydamm
€ 14.00 - 22.50 Mettm ann
Niederkassel
A52 A57 Grafenberg Schöller-
Linksrheinisch Düsseltal Dornap
Heerdt € 7.00 - 19.00 Pempelfort Grafenberg-East
€ 9.00 - 14.50
Oberkassel
Altstadt Flingern Nord Gerresheim
A3
Kaar st Stadtmitte
Carlstadt
Hafen Flingern Süd
Harbour Unterbilk
€ 14.00 - 25.00 Friedrichstadt Lierenfeld City-East
€ 9.50 - 12.50 Gr uiten
Hamm Bilk Vennhausen
Düsseldo rf
Oberbilk
Neu ss Erkr ath
Neuss Unterb ach
Eller
€ 7.00 - 9.50 Unterfeld h au s
Unterbach
South
Flehe
€ 8.00 - 11.50 A46
Volmerswerth
Wersten
Haan
Hassels Elbsee
A59 Hild en
Gr efr ath Holthausen Reisholz
Himmelg eist Solin gen
Himmelgeist
Holzh eim Itter Benrath Kalstert
Office Market Overview | 4th quarter 2018 DüsseldorfFrankfurt
Development of Main Indicators
Third strongest annual performance of all time
The space take-up of 633,300 sqm in 2018 was the third
strongest take-up performance ever in Frankfurt. The
record number of new leases was driven by company
expansions. While central locations such as the City and
Westend are now back at fifth and sixth place in the sub-
market ranking, West, City-West and Niederrad are ranked
just behind the Banking District, which again assumes
first place with one fifth of all take-up volume. It was par
ticularly noticeable that many large-scale lettings were in
decentralised locations, which tends to have a negative 2018, a rise of 26%. Three-quarters of this space is located
effect on the weighted average rent. There is a limited in the CBD alone. In terms of outlook, the above-average
choice of available space, not just across the market as performance of the letting market is expected to continue
a whole but in almost every submarket: six submarkets in 2019, the vacancy rate is likely to continue to fall, while
have a vacancy rate of under 5%. In reaction to the increa- the prime rent is expected to rise marginally.
sing scarcity of space, flexible office space providers are
improving their position – their previous record take-up
of 46,000 sqm in 2017 was overtaken by 58,000 sqm in
Frankfurt: Office Space Market Areas with Rental Bands (€/sqm/month)
Frankfurt: Office Space Market Areas with Rental Bands (€/sqm/month) JLL Research 2018/Q4
Ob er hoechstadt/Ts. Ob eru rsel Bonames
Kalbach Harheim
Kön igstein Kro nb erg
Frankfurter Berkersheim Bad Vilbel
Stein bach Berg
A5 Niederursel
Wach enb uch en
Merton-Viertel € 10.00-12.00
Bergen-
Eschersheim
Alten hain Heddernheim Enkheim
Preungesheim
Schwalbach Eschborn
€ 7.50-16.50 Eckenheim Maintal
Praunheim Seckbach
Dornbusch
Bad So den Eschb or n Fr an kfu rt Ginnheim Bisch ofsheim
am Main Seckb ach
North
Hausen Bornheim
Bockenheim € 10.00-14.00
A648 Rödelheim Doern igh eim
Kelkh eim € 9.00-12.00
Rödelheim Nordend-
Westend- Ost Riederwald
Nord Nordend-
Sossenheim East
A66 West
Westend-Süd € 8.00-18.00
Innenstadt Mü hlh eim
Ostend Fechenheim
Unterliederbach Bahnhofsviertel
Altstadt
Kaiserlei
West Gallusviertel
Sachsenhausen- € 8.00-13.00
Nied
€ 9.50 - 21.00 Nord
Zeilsheim Höchst Gutleutviertel
Zeilsheim Griesheim Ob err adOberrad Offenb ach Nordend-West
am Main Westend-Nord
A661 Laemm er spiel
Sachsenhausen
City €
€ 11.50-17.00 Bockenheim
Kriftel 13.00-30.00
Niederrad
Westend € Nordend-Ost
Schwanheim
Sindlingen Niederrad City-West € 16.00-32.00
€ 10.00-16.00 Sachsenhausen-
Süd
ê
A648
13.00-18.00 Innenstadt
Hattersheim Westend-
Süd Banking District Ob ertshau sen
Altstadt
Flughafen € 19.00-40.00
A3 Gallusviertel Central Station
Kelsterb ach Bahnhofsviertel
Okr iftel Area € 12.00-24.00
Gr aven br uch
Airport
Heu senstam m Sachsenhausen-
€ 16.00-25.00 Neu -Isen bu rg Nord
Gutleutviertel Rem br uecken
Sachsenhausen-
Edd ersh eim Main Süd
Niederrad
Office Market Overview | 4th quarter 2018 FrankfurtHamburg
Development of Main Indicators
Rental price rises observed across the entire market
The total take-up in the Hamburg office letting market
was 580,000 sqm in 2018. Although this is below the
record performance of the previous year, it remains well
above the long-term average. We expect a full-year take-
up of at least 500,000 sqm in 2019. The year 2018 was
characterised by excess demand and resulting rental price
rises across almost the entire market. Increased construc-
tion costs are also having the effect of boosting rental
levels. Not only has the prime rent risen to €28.00/sqm/
month, the average rent has increased to just under table to flexible office space providers across the Big 7
€16.00/sqm/month. There are rental price hikes across all cities, this sector was less active in Hamburg compared
submarkets. With the supply of space falling significantly to the previous year. Vacancy has been falling since the
in central locations, occupiers are now also looking at end of 2010 and the vacancy rate of 3.9% is the lowest
secondary locations. The result has been a high level of level since mid-2002; a further fall is expected by the end
take-up in Barmbek-Bramfeld. The submarket statistics of 2019. A total of 145,000 sqm office space was comple-
are again headed up by the City Centre and City South ted in 2018, of which just 18% was still available at the
submarkets. Contrary to the increasing take-up attribu time of completion.
Hamburg: Office Space Market Areas with Rental Bands (€/sqm/month)
Hamburg: Office Space Market Areas with Rental Bands (€/sqm/month) JLL Research 2018/Q4
Hummelsbüttel Sasel Volksdorf
Wellingsbüttel
A23
Puetjen Schnelsen Hamburg
Fuhlsbüttel
A7
Niendorf
Airport / Ohlsdorf
Groß Borstel Hamburg North-East
Halstenb ek
€ 7.00-11.50 € 8.00-11.50
Bramfeld Farmsen-Berne
Eidelstedt Groß Borstel Alsterdorf Steilshoop
Rahlstedt
Schen efeld City Nord
€ 8.50-15.00
Barmbek /
Lurup Winterhude / Bramfeld
Lokstedt
Uhlenhorst Winterhude € 10.00-15.50
Eppendorf € 10.00-14.50
Iserbrook Stellingen Barmbek-Nord
Hamburg-West
€ 8.00-11.50
Tonndorf
Hoheluft-Ost Dulsberg
Ham bu rg Wandsbek
Hoheluft-West
Eppendorf / Barmbek-Süd Wandsbek
Harvestehude
Osdorf Bahrenfeld Harvestehude / € 8.00-14.00
Jenfeld
Eimsbüttel Rotherbaum
Eimsbüttel € 12.50-22.00 Uhlenhorst
€ 10.00-14.50 Bar sbü ttel
Außenalster Eilbek Marienthal
Rotherbaum
Groß Flottbek Altona-Nord East of Alster /
Sternschanze Hohenfelde A24
St. Georg
Altona-Ottensen-Bahrenfeld
St. Pauli € 12.50-21.50
€ 11.00-16.50 St. Georg
€ 10.50-21.50
Nienstedten St. Pauli Borgfelde
City Centre City Süd (Outer Zone)
Hamm
Othmarschen Ottensen Neustadt € 8.00-12.50 Horn
Altona- € 14.50-28.00
Hamburg-
Altstadt Altstadt
Billbrook /
Elbe Harbour fringe City Süd Hammerbrook
(Core Area) Billwerder / A1
Bille Billstedt Billstedt
Norderelbe € 13.50-22.50 € 8.50-15.50
HafenCity
€ 6.00-12.50
Vorhafen
Köhlfleet Parkhafen HafenCity
Finkenwerder Steinwerder
PetroleumhafenWaltershof
Harburg - south of the river Elbe € 16.00-24.00 Rothenburgsort
€ 8.00-14.50 Kleiner Billbrook Bergedorf
Grasbrook € 9.00-14.00
Veddel Billwerder Bucht
Office Market Overview | 4th quarter 2018 HamburgCologne
Development of Main Indicators
Significant increases in rental price level
There was a robust space take-up of 305,000 sqm in the
Cologne office letting market in 2018, which is just below
the previous year’s total of 307,000 sqm, but still 4% above
the 10-year average. Three new leases were concluded in
the >10,000 sqm size category, including the letting of
13,000 sqm to Design Offices in the I/D Cologne project
in the Kalk/Mülheim submarket, ahead of the letting of
10,600 sqm to the Oberfinanzdirektion (regional finance
office) in Dominium in the City Centre submarket and a new
lease signed by Siemens for 10,400 sqm also in I/D Cologne. in 2019 to 2.9%. Around 90,000 sqm of new office space
The most active sector was business services providers came onto the market in 2018, although it was already let
which leased a quarter of all space, including 28,000 sqm or taken-up by owner-occupiers at the time of completion
let to flexible office space providers which took-up almost and therefore offered no improvement in the short-term
three times as much space as in the previous year. Total availability of space. The increasing scarcity of high-quality
take-up is anticipated to be up to around 280,000 sqm in office space in central locations over the last few years is
2019. The vacancy rate has been falling steadily since 2009 now having a significant effect on rental levels.
to its current level of 3.3%, and it is expected to fall further
Cologne: Office Space Market Areas with Rental Bands (€/sqm/month)
Cologne: Office Space Market Areas with Rental Bands (€/sqm/month) JLL Research 2018/Q4
Auweiler Heimersdorf Har dt
Lindweiler
Pulh eim Pesch E31 Flittard
Esch/Auweiler
Longerich Dünnwald
Ossendorf/ Ber gisch
Stammheim
Nippes Weidenpesch Höhenhaus Glad bach
Bocklemünd/Mengenich
Ossendorf
€ 6.50-12.50 Niehl
Other Locations
A57
Mauenheim € 6.00-11.50
Wid der sdo rf Bilderstöckchen
Dellbrück
Widdersdorf
Mülheim
Brauweiler Vogelsang Nippes Holweide
Bickendorf Riehl
Neuehrenfeld Kalk/
Köln
Mülheim Buchheim Ben sber g
€ 7.00-16.00
Lövenich
Neustadt-Nord
Ehrenfeld
Ehrenfeld/ Buchforst
Müngersdorf
Braunsfeld
€ 6.50-15.50
Braunsfeld Höhenberg A4
Weiden Altstadt-Nord Merheim Brück
Kalk
Deutz
Peripherie West City Centre Deutz/
€ 7.00-10.50 € 9.50-23.50 Messe Neubrück
Buschb ell Altstadt-Süd Vingst
Lindenthal € 9.50-19.00 Humboldt-
Junkersdorf Gremberg Ostheim
Marsd or f
Lindenthal/ Rath/Heumar
Sülz Neustadt-Süd
€ 8.00-13.50 A559 Rath
Sülz Poll
Fr ech en Bayenthal Fo rsbach
Raderberg
A1 Klettenberg Zollstock Gremberghoven
Bayenthal/ Rhinebank-West
Porz/
Marienburg € 13.00-23.00 Westhoven
Gremberghoven
€ 9.00-15.00 Marienburg
Ensen
€ 8.50-12.50 Eil
Raderthal A3
Gleu el Finkenberg
Rösrath
A59
Hür th
Rodenkirchen
Ber ren rath Porz
Rondorf A555 Rodenkirchen Weiß
Urbach
Grengel
Kon rad er ho ehe € 7.00-10.50
Hahnwald
Zündorf
Sürth Elsdorf
Meschenich ImmendorfImmendorf Godorf Wahnheide Köln/Bonn
Office Market Overview | 4th quarter 2018 CologneMunich
Development of Main Indicators
Market characterised by high levels of take-up
and rising rents
Take-up in the Munich office letting market was 975,000 sqm
in 2018. This is the second best annual performance of
the last 10 years. In view of the scarcity of space – there
is practically full letting in some submarkets – this level
of take-up was only achievable due to the preletting of
development projects, a large proportion of which were in
the East submarket and accounted for almost two-thirds
of all new leases in the >5,000 sqm size category. The
East submarket heads up the submarket statistics with course of the year, to reach 2.9% by the end of December,
take-up of around 230,000 sqm, ahead of the City Centre its lowest level since 2002. The significant excess demand
(145,000 sqm). The most active sector was industrial com- has resulted in rent rises across the market and is being
panies (180,000 sqm). The boom in the flexible office space driven by the many lettings in development projects and
sector continued in Munich in 2018. 53,000 sqm was let rising construction costs. The prime rent has increased to
to these operators and at the beginning of 2019, around €39.00/sqm/month and is expected to continue to rise
150,000 sqm flexible office space was available in some significantly during 2019.
90 locations. The vacancy rate fell by 0.7% during the
Munich: Office Space Market Areas with Rental Bands (€/sqm/month)
Munich: Office Space Market Areas with Rental Bands (€/sqm/month) JLL Research 2018/Q4
Rothsch waig e
Kar lsfeld Ism an in g
A9 Speichersee
Ob erschleiß heim
A8
Neu -Esting
E45
Periphery-North
Feldmoching-Hasenbergl € 9.50-15.50
Olch ing
North
€ 12.00-19.50
Gr öb enzell
A99
Schwabing-Freimann
Allach-Untermenzing Milbertshofen-Am
Hart
Olympiapark
Moosach Kirchh eim
€ 12.50-20.00 b. M ün ch en
Eichen au North-Schwabing Poin g
Puch heim Gr ub
€ 15.00-24.50
Heim stetten
Aubing-Lochhausen-Langwied West
Schwabing-West
€ 14.50-21.50 Bogenhausen
Neuhausen-Nymphenburg
Periphery-East
City Centre Arabellapark € 15.50-22.50 € 9.50-15.50
Maxvorstadt € 21.00-39.00
Bogenhausen A94 Parsdo rf
Pasing-Obermenzing Riem
Laim Mü nch en € 18.50-29.00
Altstadt-Lehel
Westend Schwanthalerhöhe Moosfeld/
Au-Haidhausen Ottend ich l
€ 15.50-24.00 Ludwigsvorstadt-Isarvorstadt Berg am Laim Riem
A96 € 9.50-16.50
Ger merin g East
Gr äfelfing
€ 14.50-28.00
Sendling-Westpark
Trudering-Riem
Sendling
Periphery-West Hadern Haar
€ 9.50-14.50 Ramersdorf-Perlach
Planeg g Martin sr ied
Vater stetten
South
€ 11.00-19.00 Untergiesing-Harlaching Neuperlach
Obergiesing € 11.00-16.00
Thalkirchen-Obersendling-Forstenried-Fürstenried-Solln
Stockdo rf A995
A95 Periphery-South Neu b ib erg
€ 9.50-14.50
Gau tin g
Ottob ru nn
Unterb ru nn Unterh ach ing
Gr ün wald
Office Market Overview | 4th quarter 2018 MunichStuttgart
Development of Main Indicators
Letting activity limited by the all-time
low vacancy level
Take-up in the Stuttgart office letting market was around
215,300 sqm in 2018, the lowest level since 2012 despite
the continued appeal of the Stuttgart office market for
occupiers. Due to the lack of availability of large-areas of
high quality space, one-third of all take-up is in develop-
ment projects. The owner-occupied projects by Bosch and
the public sector in the Feuerbach and City Centre submar-
kets comprised almost 30% of total annual take-up. The
most active submarket was Feuerbach with a share of mes of completions in 2019 and 2020, but the high propor-
around 27%, while most new leases were concluded in the tion of prelets and owner-occupier deals (76%) means that
City Centre submarket (around 22%). The most active sec- there will be little relief in the office market. Take-up in 2019
tor was again industrial companies (36%) but the greatest is unlikely to exceed the previous year’s total. There is likely
number of new leases were signed by business services to be a slight increase in the vacancy rate, which had fallen
providers (24%). Of around 75,000 sqm of newly construc- to 2.2% at the end of 2018. However, the prime rent is ex-
ted office space in 2018, just 9% was available at the time pected to rise by €1.00/sqm/month to €24.50/sqm/month
of completion. It is expected that there will be higher volu- in 2019, thanks to the marginal increase on the supply side.
Stuttgart: Office Space Market Areas with Rental Bands (€/sqm/month)
Stuttgart: Office Space Market Areas with Rental Bands (€/sqm/month) JLL Research 2018/Q4
Stammheim Neu stad t
Neu wirtshau s Rem s-M u rr-Kr eis
Zuffenhausen Kor b
Hirschland en
€ 8.00-11.00 Mühlhausen
Kor ntal-M ün chin gen
Zuffenhausen
Ditzin gen Waib ling en Klein hep pach
Münster
Bein stein
Hoefing en
Geb ersheim Weilimdorf Bad Cannstatt
€ 10.50-14.00 Feuerbach Fellbach
Rutesh eim € 10.00-16.50
€ 12.00-18.00 Weinstadt
Weilimdorf Bad Cannstatt Rem shald en
Ker nen
Stuttg art im Remstal
Feuerbach
Ger ling en
Stuttgart-North
Leon b er g
€ 12.00-18.00
Stuttgart-Nord Stetten
Untertürkheim im Remstal Schn ait
Mitte Stuttgart-Ost Stru em pfelbach
Botnang Unter-Obertürkheim/
Stuttgart-West
City-Centre Wangen-Hedelfingen
Stuttgart-West Obertürkheim
€ 13.50-23.50 € 9.00-15.50
€ 10.00-16.50 Stuttgart-East
Wangen
€ 10.00-15.00
War mb ro nn
Stuttgart-South
Stuttgart-Süd
€ 10.00-16.50 Hedelfingen
Mag stadt
A81 Degerloch
€ 9.50-16.50 Sillenbuch
Vaihingen
Degerloch
Esslin gen
Vaihingen-Möhringen Hoffeld am Neckar
€ 9.50-18.00
A831 Ostfild ern
Möhringen
Birkach
Kem nat
Fasanenhof Plieningen
Sind elfin gen € 11.00-16.00 € 9.00-10.50 Ploch ing en
Plieningen
Leinfelden -E chterd ing en
A8 Den kend or f
Dag ersh eim
Leinfelden-Echterdingen
Böb ling en € 10.00-19.00 Wern au
Neu h au sen
(Neckar)
Stuttgart au f d en Wen dling en
Ber nh ausen Filder n am Neckar
Office Market Overview | 4th quarter 2018 StuttgartContacts
Contact Berlin
Stephan Leimbach Helge Scheunemann Stephan Leimbach
Head of Office Leasing Germany Head of Research Germany Head of Office Leasing Germany
Frankfurt Hamburg Frankfurt
+49 (0) 69 2003 1245 +49 (0) 40 350011 225 +49 (0) 69 2003 1245
stephan.leimbach@eu.jll.com helge.scheunemann@eu.jll.com stephan.leimbach@eu.jll.com
Contact Düsseldorf Contact Frankfurt Contact Hamburg
Martin Becker Markus Kullmann Tobias Scharf
Senior Team Leader Office Leasing Senior Team Leader Office Leasing Senior Team Leader Office Leasing
Düsseldorf Frankfurt Hamburg
+49 (0) 211 13006 600 +49 (0) 69 2003 1062 +49 (0) 40 350011 242
martin.becker@eu.jll.com markus.kullmann@eu.jll.com tobias.scharf@eu.jll.com
Contact Cologne Contact Munich Contact Stuttgart
Andreas Reul Petra Bolthausen Sebastian Treier
Team Leader Office Leasing Senior Team Leader Office Leasing Team Leader Office Leasing
Cologne Munich Stuttgart
+49 (0) 221 2775 45 +49 (0) 89 290088 169 +49 (0) 711 900370 36
andreas.reul@eu.jll.com petra.bolthausen@eu.jll.com sebastian.treier@eu.jll.com
jll.de Information regarding JLL and our services
jll.de/research All research reports on current market figures and special topics
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