Office Market Overview - Big 7 | 2nd quarter 2018 July 2018 - JLL
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Office Market Overview Big 7 | 2nd quarter 2018 July 2018
Office space supply sinks further across the board
A historic debacle at the FIFA World Cup, a sprawling trade The generally positive situation on the employment market
dispute, huge disagreements within the governing coalition strengthens private consumption, which is increasingly
and the EU: these events dominated the headlines at the becoming the mainstay of the German economy. This will
end of the second quarter of 2018 – a year that at the start not change even after the loss in revenue expected in the
was still brimming with economic strength and promised restaurant business following Germany’s elimination from
positive growth rates. All this has changed. Not only have the World Cup.
companies in the recent ifo index and ZEW index, which
has fallen to its lowest level since November 2012, down- Take-up volume has clearly stabilised again – flexible
graded their assessment of the current situation, but eco- office space providers expand further
nomic research institutes have also adjusted downwards, At the end of the first quarter, we asked whether we faced a
in some cases significantly, their economic expectations turnaround or a forced hiatus in the lettings volume. Three
for Germany in the current year. According to Consensus months later, it’s clear that the answer is a ‘forced hiatus’.
Economics, GDP should increase by 2.1% (down from 2.4% Take-up in the seven office strongholds has clearly stabilised
in the previous quarter), while the institute is now expec- again, reaching almost the same level as the previous year
ting growth of below 2% for 2019. The decline in export with 1.83 million sqm. The fundamental employment market
activity has the most significant impact on the reduced data remains intact, and despite the political turmoil and eco-
growth forecasts. Since an end to the trade dispute with the nomic uncertainty companies are still desperately seeking
USA is currently not in sight, the uncertainty of companies skilled workers. This search is not always successful. Some ex-
and the market turmoil will continue throughout the rest of pansion plans therefore remain on hold and a potential move
the year. Nevertheless, the labour market continues to send is deferred as a result. Even if a move is targeted and planned,
positive market signals. The unemployment rate fell further it cannot always be realised in view of the continuing shortage
to 5.2% in May. Nothing has changed in principle in the gap of suitable office space. Both factors explain why we continue
between the demand for labour and supply of skilled staff. to characterise the current situation as a ‘forced hiatus’.
Completions and Vacancy Rate Big 7
vv
Vacancy
-704,000 sqm
compared to last ar
Office Market Overview | 2nd quarter 2018 2
case that larger spaces are rented than before. Another
relevant aspect of the current rental market is the con-
tinuing demand for space by flexible office space providers
to support their ambitious expansion plans especially in
the seven strongholds. We also observe here that owners
Munich was again responsible for the largest take-up volume of office space are increasingly receptive to the expansion
in the first half of 2018 with around 468,000 sqm of rented wishes of these operators. Thus, these new flexible work-
space and a 12% increase compared to the previous year, place models compete with the ‘normal’ spaces to be
followed by Berlin with 391,000 sqm. The shortage of space rented and users, faced with the current scarcity of space,
is particularly noticeable in the German capital, causing are faced with the question of which concept opens up
take-up to decline by more than 8% in a year-on-year com- which opportunities and advantages for them. In the Big 7
parison. However, Hamburg and Cologne suffered the locations, there were around 430 established and almost
sharpest decrease of almost 23% and approx. 26% res- 60 planned flexible office space locations operated by a
pectively. The net absorption figure, which increased sig- total of 240 providers at the end of June. Once all locations
nificantly in the period from April to end-June compared have been opened, close to 77,000 workplaces on 764,000
to the previous quarter and amounts to a volume of sqm of office space will then be available. In the current
232,000 sqm for the first half of the year, shows that nothing year, the previous year’s volume is likely to be significantly
has changed in terms of the fundamental desire of many exceeded with a total area of 120,000 sqm. This also in-
companies to expand. When they do move, it’s often the creases the share of the overall volume. After around
Prime Rental Index and Take-up
v
Prime Rent Q2 2018
compared to last ar
+4.4 %
Office Market Overview | 2nd quarter 2018 3
250,000 sqm was let to flexible office space operators in office space can only be described as sufficient in Düsseldorf
2017, take-up in the first six months of 2018 already amounts and in Frankfurt, with vacancy rates of over 7%. In all other
to almost 116,000 sqm. This corresponds to a 6% share of strongholds the vacancy rates are between 4.6% in Ham-
the total take-up volume in the Big 7. The operators are burg and 2.3% in Stuttgart. A turnaround would be realistic
particularly active in Frankfurt and Munich at present. only with an increase in newly built space. However, this is
These two strongholds alone account for almost 70,000 sqm not the case, because the full order books at construction
of the take-up volume. The biggest deals in this segment companies leave little room for new orders. This means
were registered by Design Offices with 14,000 sqm in Munich that a pick-up in investments is further delayed, combined
and a further 8,600 sqm in Hamburg, as well as by WeWork with maximum uncertainty as to when construction work
in Munich with 11,600 sqm. can start on planned projects. By the end of the year, we
For the second half of the year, we expect to see a continu- expect to see a further drop in the vacancy rate to 4.2%. For
ation of the booming market for office space with sustained users that want to move or expand, the choice of existing
strong demand and a high potential willingness of compa- spaces continues to be limited. They have the option of
nies to relocate, as well as an increasingly precarious sup- renting a space in a project development or a making a
ply side. We have slightly increased our take-up forecast for temporary move into a co-working or business centre space.
the full year to just under 3.9 million sqm, but it is unlikely
that the previous year’s volume will be achieved. New construction volume of 1 million sqm in 2018
only 5% above the five-year average
Vacancies continue to fall rapidly In the first half of 2018, almost 329,000 sqm of office space
The vacancy rate for the Big 7 fell by a further 20 basis was completed across all seven strongholds. That‘s almost
points to 4.3% within the last three months. If this pace is 20% less than a year ago. New building space only increased
maintained, all vacancies in the Big 7 would disappear in in two cities: in Dusseldorf by almost 18% and in Munich by
around five years’ time. That’s certainly unrealistic. But almost 57%. The example of the Bavarian property strong-
considering how long it takes to build new projects from hold clearly indicates that the strong relative increase is
design to realisation, it is clear that we are still dealing with deceptive and the imbalance between supply and demand
a significant lack of good space. The short-term supply of continues to exist. Only 63,500 sqm of new space ultimately
came onto the market, but the vacancy volume fell by 11%
in the same period. In the second half of 2018, a further
674,000 sqm of new building space is likely to be added in
the Big 7. Compared to previous expectations, this would
slightly reduce the annual volume to just over 1 million
sqm. All in all, far too little, especially since around 38% of
the space that will be completed in 2018 will be in Munich
alone. Even more significant for the overall assessment is
the fact that only 141,000 sqm (21%) is still available. As
Office Market Overview | 2nd quarter 2018 4
things stand at present, the postponement of projects 2001. In a one-year comparison, this represents an increase
has the effect that the number of completions should rise of 4.4%. By the end of the year, we expect to see a further
significantly next year. Currently, more than 1.9 million sqm increase in the index to 201.7 points, corresponding to a
is in the pipeline for 2019. That would be the largest volume rise of 3.7% over the year. In addition to the top locations,
in the past 10 years. Whether these spaces will actually be there is also corresponding demand in other sub-markets
realised next year remains to be seen, and depends not within the strongholds that leads to higher rental prices.
least on the resources and capacities of the construction In some instances, the higher rents in city centres and
companies. CBDs are forcing office users to turn to peripheral locations,
particularly as space availability is also greater there. For
Rental price growth is broadening to more areas the office markets, a broader distribution of demand is
The imbalance between supply and demand provides the undoubtedly beneficial, even if such a move is not an
ideal breeding ground for further rental price growth in option for all user groups.
almost all office strongholds. The growth is strongest in the
two cities with the fewest vacancies: the prime rent in Berlin
increased by almost 13% in a 12-month comparison, ahead
of Stuttgart with an increase of almost 7%. The JLL prime
rental price index for the Big 7 reached 197.9 points at the
end of June 2018, its highest level since the third quarter of
Office Space Take-up incl. Owner Occupier (sqm)
2017 H1 2017 H1 2018 Trend prognosis 8
Berlin 1 944,800 426,700 391,300 è
Düsseldorf 2 390,600 229,300 216,600
Frankfurt/M 3
711,300 237,900 259,200 è
Hamburg 4 640,000 323,400 250,000 è
Cologne 5 306,900 166,300 123,800 â
Munich Region 6 995,000 418,000 468,000 è
Stuttgart 7
254,700 110,900 118,300 è
Total 4,243,300 1,912,500 1,827,200
Office Market Overview | 2nd quarter 2018 5
Vacancy incl. Space for subletting
Q4 2017 Q2 2017 Q2 2018
Trend prognosis 8
sqm Rate (%) sqm Rate (%) sqm Rate (%)
Berlin 1 701,300 3.5 822,500 4.1 638,200 3.2 è
Düsseldorf 2 720,200 7.9 715,900 7.9 705,200 7.7 è
Frankfurt/M 3
886,600 7.6 1,001,700 8.5 848,000 7.3 è
Hamburg 4 712,800 4.8 757,300 5.1 689,900 4.6 è
Cologne 5 315,000 4.1 347,000 4.5 281,200 3.7 è
Munich Region 6 731,300 3.6 813,400 4.0 649,800 3.2 è
Stuttgart 7
236,300 2.7 262,100 3.1 203,300 2.3 è
Prime Office Rents (€/sqm/month)
Q4 2017 Q2 2017 Q2 2018 Trend prognosis 8
Berlin 1 30.00 28.00 31.50
Düsseldorf 2
27.00 26.50 27.00
Frankfurt/M 3 38.00 37.00 38.50
Hamburg 4
26.50 26.00 26.50
Cologne 5 22.00 22.00 22.00
Munich Region 6
37.00 36.00 37.50
Stuttgart 7 22.50 22.00 23.50
Completions (in sqm)
2017 H1 2017 H1 2018 Trend prognosis 8
Berlin 1 109,000 92,600 70,500
Düsseldorf 2 112,000 46,700 54,900 è
Frankfurt/M 3
89,800 42,700 38,400
Hamburg 4 181,600 119,300 80,000 è
Cologne 5
68,700 31,500 21,400
Munich Region 6 195,200 40,500 63,500
Stuttgart 7
103,400 32,900 0 è
Office Space Stock (in Mill. sqm)
2017 Q2 2017 Q2 2018
Berlin 1
20.23 20.27 20.22
Düsseldorf 2
9.13 9.10 9.15
Frankfurt/M 3 11.70 11.74 11.59
Hamburg 4 14.90 14.86 14.95
Cologne 5 7.69 7.67 7.68
Munich Region 6
20.24 20.12 20.23
Stuttgart 7 8.65 8.58 8.65
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 2018 compared to prior year.
Office Market Overview | 2nd quarter 2018 6
Berlin
Development of Main Indicators
No new take-up records due to lack of available space
The Berlin office letting market is suffering badly from the lack
of available space. This has resulted in 391,300 sqm or 8%
less space being taken-up compared to the same period the
previous year. Nonetheless, there is still strong demand. The
last few years have been characterised by the expansion of
Berlin-based companies, but these are now joined by large
international companies and organisations also looking for
space in the German capital. Demand is faced with extremely
short supply. The vacancy rate across the whole of Berlin is currently under construction. This emphasises the fact that
now just 3.2%, and is practically non-existent in a number Berlin’s office submarkets are now expected to expand
of submarkets around the S-Bahn urban railway ring. As a spatially over the medium-term.
result, there has been a further rise in prime and average It is expected that the total full-year take-up will be in the
rents to their current levels of €31.50/sqm/month and order of 850,000 sqm and that rents will continue to rise. The
€18.57/sqm/month respectively. The city fringe locations vacancy rate will fall to under 3%. The current high level of
are also becoming increasingly attractive, such as the new-build activity provides some hope for an increase in
Südkreuz district, where Vattenfall has just leased 27,000 available supply from 2020 and a continued high level of
sqm for its new German headquarters in a development take-up, assuming the economy remains stable.
Berlin: Office Space Market Areas with Rental Bands (€/sqm/month)
Wedding Wedding Gesundbrunnen
Klar aho eh
Tiergarten A114 Area Main Station-Europacity
Prenzlauer
€ 21.00 - 30.00 A10 Berg
Kon rad sh A111 Moabit
Tegeler See Malcho w(H oh en sch
Charlottenburg Reinickendorf Northern Suburb
€ 8.00 - 14.00
Charlottenburg 1A Pankow Mitte
€ 17.50 - 31.00 Schöneberg A105
Hansaviertel
Mitte 1A
€ 19.00 - 31.50
Berlin-Tegel
Falken see
Wilmersdorf
Tiergarten
Prenzlauer Lichtenberg
Area Potsdamer-Leipziger Platz
Berg-Friedrichshain
€ 21.00 - 30.00
€ 16.00 - 25.00 Kreuzberg
Ber lin Mitte
Schöneberg
Spandau Marzahn-Hellersdorf
Western Suburb Charlottenburg-Tiergarten Mitte
€ 9.50 - 14.00 € 12.50 - 21.00 € 16.00 - 25.00 Friedrichshain-Kreuzberg
Mediaspree Eastern Suburb
Charlottenburg-Wilmersdorf € 9.00 - 13.50
€ 19.00 - 28.00
Altglienicke
Havel Wilmersdorf-Schöneberg
Kreuzberg-Tempelhof
Großziethen € 12.00 - 20.00
Bohnsdorf € 13.00 - 23.00
Schönefeld
Berlin-Schönefeld
Gato w
Berlin-Schönefeld Kienberg
Waßmannsdorf A103
Waltersdorf Tempelhof-Schöneberg
Area Airport Berlin- A100
Brandenburg € 8.50 - 18.50 Southern Suburb
A115 € 8.00 - 15.50 Treptow-Köpenick
Glasow Kiekebusch
Rotberg
Karlshof Neukölln
Klad ow Tollkrug
Blankenfelde Steglitz-Zehlendorf
A113 Großer
A113
Groß Kienitz
Adlershof Müggelsee
E55 A10
Dahlewitz € 10.00 - 15.50
A13
Brusendorf
Klein Kienitz
Office Market Overview | 2nd quarter 2018 Berlin
Düeldorf
Development of Main Indicators
Above-average second quarter and significant
potential for the second half year
The weak first quarter in the Düsseldorf office letting market
was followed by an above-average second quarter. Total
take-up in the first half of the year was around 217,000 sqm,
of which 193,000 sqm was in the Düsseldorf city area. This
is a 6% decrease compared to the same period the pre-
vious year, but there are a number of large-scale deals in
the >10,000 sqm size category underway for the second half
of the year, which is likely to drive the total full-year take-up Just under 55,000 sqm office space was completed over
to around 500,000 sqm. The largest deal of the year to date the first half of the year, significantly above the 5-year
is the letting of 35,500 sqm to the accountancy firm Deloitte average, with the majority of it already let. The prime rent
in a project in the North submarket. This large-scale letting is achieved in the CBD and remained stable at €27.00/
means that the business services sector is the most active sqm/month over the first six months. It is likely that this
in the market, accounting for around 45% of total take-up will rise by €0.50/sqm/month over the coming months.
volume. The vacancy rate (including space available for The weighted average rent has risen from €14.64 to
subletting) has fallen from 8.0% to 7.7% over the last three €16.14/sqm/month over the past year due to the large-
months, and the vacancy rate in the city area is just 6.7%. scale lettings in development projects.
Düsseldorf: Office Space Market Areas with Rental Bands (€/sqm/month)
Lank-L atu m Lang stkierst
Kalkum Pempelfort
Fischeln Kalkum
Kaiserswerth Altstadt
Ilverich
Ratin gen Oberkassel
Airport
Stru em p
A44
€ 11.00 - 16.50 Ratingen
Lichtenbroich
Carlstadt Stadtmitte
CBD Düsseldorf Nied erschwar zbach
Lohausen € 8.00 - 15.50
Düsseldorf € 17.50-27.00
Rhein
City
€ 9.00 - 26.00
Unterrath
Hafen Government District
€ 11.50 - 19.50
Stockum North Rath
Unterbilk Metzkau sen
Rhein € 8.00 - 16.50 Friedrichstadt
City-South Oberbilk
Derendorf Lu den berg
Mörsenbroich € 8.00 - 11.00
Bilk
Seestern
Lörick Ludenberg Hubbelrath
Golzheim
Kennedydamm
Meerb usch € 9.50 - 13.50
€ 13.50 - 22.00 Mettm ann
A52 Niederkassel
A57 Grafenberg
Linksrheinisch Düsseltal
Heerdt € 7.00 - 18.50 Pempelfort Grafenberg-East A3
€ 9.00 - 13.50
Oberkassel
Kaar st Altstadt Flingern Nord Gerresheim
Stadtmitte
Carlstadt
Hafen Flingern Süd
Harbour
€ 14.00 - 23.00
Unterbilk Friedrichstadt Gr uiten
Lierenfeld
Hamm City-East
Düsseldo rf Bilk Vennhausen
Oberbilk € 9.50 - 12.50
Neuss Erkr ath
€ 7.00 - 9.50 Unterb ach
Eller
Unterfeld h au s
Unterbach
South
Flehe
€ 8.00 - 11.50 A46
Volmerswerth
Wersten
Haan
Elbsee
Hassels
Himmelgeist Hild en
Gr efr ath Reisholz A59
Himmelg eist Holthausen
Neu ss Itter
Holzh eim Benrath Kalstert
Office Market Overview | 2nd quarter 2018 Düeldorf
Frankfurt
Development of Main Indicators
Strong first half year on the office market
Despite the weaker second quarter, the total take-up volume
was 259,200 sqm over the first six months, an increase of
9% compared to the same period the previous year. The
most active sector was again flexible office space providers.
There was a particularly high number of deals: the 350 new
leases concluded in the period from January to the end of
June was the highest for at least 10 years. The total full-year
take-up in 2018 is expected to be in the order of 575,000 sqm,
in line with our forecast from the early part of the year. 260,000 sqm); over one third of this is already prelet. Al-
Once again, a high volume of office space was removed though there is an urgent need for available space, little
from the market, which resulted in a further fall in the short- came onto the market in the second quarter of 2018. The
term availability of space. Worthy of particular note is the less than 10,000 sqm of space expected to be completed by
significant decrease in space in the Banking District, where the end of the year and still available is a significant short-
the vacancy rate has fallen to just 2.5%. Developers have fall. The prime rent rose slightly to €38.50/sqm/month, and
had the good sense to push ahead with speculative new- rents also increased in a number of major submarkets.
build projects in this submarket where the majority of Rising building costs and the available capacity amongst
space currently under construction is located (approx. construction companies remain the hot topics.
Frankfurt: Office Space Market Areas with Rental Bands (€/sqm/month)
Ob er ho echstad t/Ts. Ob eru rsel Bonames
Kalbach Harheim
Kön igstein Kro nb erg
Frankfurter Berkersheim Bad Vilb el
Stein bach Merton-Viertel Berg
Niederursel
€ 8.50-12.00
Wachen buch en
Eschersheim Bergen-
Alten hain Heddernheim
Preungesheim Enkheim
Schwalbach
Eschborn
€ 7.50-16.50 Eckenheim Maintal
Praunheim Seckbach
Bad So den Dornbusch
Esch b or n Fr an kfu rt Ginnheim Bisch ofsheim
am Main Seckb ach
Hausen North Bornheim
Bockenheim
€ 10.00-12.50
Kelkh eim A648 Rödelheim Westend-
Doern igh eim
€ 9.00-12.00
Rödelheim Nord Nordend-
Ost Riederwald
Nordend-
Sossenheim East
A66 West
Westend-Süd € 8.00-18.00
Innenstadt Mü hlh eim
Ostend Fechenheim
Unterliederbach West Bahnhofsviertel
Altstadt
€ 9.50 - 19.50
Gallusviertel Kaiserlei
Nied Sachsenhausen-
Nord € 8.00-13.00
Zeilsheim Höchst Gutleutviertel
Zeilsheim Griesheim Ob err adOberrad Offenb ach
am Main Nordend-West
A661 Westend-Nord Laemm er spiel
Sachsenhausen
€ 11.50-17.00 City
Kriftel Bockenheim € 12.00-29.00
Niederrad
City-West
Schwanheim
Niederrad Westend Nordend-Ost
Sindlingen
€ 12.00-18.00
€ 9.00-16.00 € 15.00-32.00
Sachsenhausen-
A648
Süd Innenstadt
A5
Hattersheim Westend- Banking District Ob ertshau sen
Süd
€ 19.00-38.50 Altstadt
Flughafen
A3
Gallusviertel
Kelsterb ach Central Station Bahnhofsviertel
Okr iftel Gr aven br uch Area € 10.00-22.00
Airport
Heu senstam m Sachsenhausen-
€ 15.00-25.00 Neu -Isen bu rg Nord
Rem br uecken
Gutleutviertel
Sachsenhausen-
Edd ersh eim
Main Süd
Niederrad
Office Market Overview | 2nd quarter 2018 FrankfurtHamburg
Development of Main Indicators
Letting market at around the 5-year average
Total take-up was in the order of 250,000 sqm in the Ham-
burg office letting market in the first half of 2018. However,
the level of occupier demand is actually higher than this
performance might suggest. We still expect the total full-
year take-up in 2018 will be up to 550,000 sqm. The take-
up statistics by submarket are headed up by the City Centre
(58,000 sqm) and City South (Core Area) (46,000 sqm).
The most active sector is business services providers
(45,000 sqm), ahead of transport/distribution (30,000 sqm). is hardly any relief expected from development projects.
Flexible office space providers were more active in the Just under 170,000 sqm office space is due to be com-
second quarter than earlier in the year. The volume taken- pleted throughout 2018, of which almost one quarter
up by this group was driven by the 8,600 sqm letting to remains currently unlet. It is expected that the level of
Design Offices in the Olympus new-build in the City South completions will fall significantly over the coming years
(Core Area) submarket, pushing their total take-up volume and then pick up again from 2021. The prime rent re-
to 15,000 sqm over the first half year. There was a further mained stable compared to the previous quarter at
marginal fall in the supply of office space and the vacancy €26.50/sqm/month, whilst the average rent rose to an
rate of 4.6% is the lowest level since 2002. Currently, there all-time high of €15.90/sqm/month.
Hamburg: Office Space Market Areas with Rental Bands (€/sqm/month)
Hummelsbüttel Sasel Volksdorf
Wellingsbüttel
A23 Schnelsen
Puetjen Hamburg
Fuhlsbüttel
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
€ 8.50-14.50
Barmbek /
Lurup Winterhude / Bramfeld
Lokstedt
Uhlenhorst Winterhude € 10.00-14.00
Eppendorf € 9.00-14.00
Iserbrook Stellingen Barmbek-Nord
Hamburg-West Eimsbüttel
€ 8.00-11.50 € 9.00-13.50
Tonndorf
Hoheluft-Ost Ham bu rg Dulsberg Wandsbek
Hoheluft-
West Barmbek-Süd Wandsbek
A7 Harvestehude
Osdorf Bahrenfeld € 8.00-13.50
Eppendorf / Jenfeld
Eimsbüttel
Harvestehude / Uhlenhorst
Rotherbaum
Bar sbü ttel
€ 12.50-20.00 Eilbek Marienthal
Rotherbaum
Altona-Nord
Groß Flottbek East of Alster /
Altona-Ottensen-Bahrenfeld Außenalster
Hohenfelde
Sternschanze St. Georg A24
€ 11.00-16.50
St. Pauli € 12.00-20.50
€ 10.00-20.50 St. Georg
Nienstedten St. Pauli Borgfelde
City Centre Hamm
Othmarschen Neustadt Horn
Ottensen Altona- € 14.50-26.50
City Süd (Outer Zone) Billbrook /
Altstadt Hamburg-
€ 8.00-12.50 Billwerder / A1
Elbe Altstadt City Süd Hammerbrook
(Core Area)
Harbour fringe Billstedt Billstedt
Norderelbe € 8.50-15.00
€ 12.50-22.50 € 6.00-12.00
HafenCity
Vorhafen
Köhlfleet HafenCity
Finkenwerder Steinwerder
Waltershof € 16.00-22.50 Rothenburgsort
Harburg - south of the river Elbe
Bergedorf
€ 8.00-14.00 Kleiner Billbrook
Grasbrook € 8.00-12.00
Veddel Billwerder Bucht
Office Market Overview | 2nd quarter 2018 HamburgColog
Development of Main Indicators
Scarcity of available space reflected in the
take-up statistics
Total take-up was in the order of around 124,000 sqm in the
first half year, a decrease of 26% compared to the same pe-
riod the previous year. There are three main reasons for this
development: firstly, small to medium-sized businesses are
currently behaving very cautiously and tending to be hesitant
in making long-term decisions relating to the take-up of new
office space, given the current economic and political situa-
tion. Secondly, there is very little attractive space available in 5,600 sqm. The vacancy rate has fallen to 3.7% over the year
central locations. And thirdly, asking rents are often above the to date, and this is expected to decrease further. The situa-
rather more conservative expectations of many occupiers. A tion has not been relieved by office new-build completions
number of large-scale deals are expected in the second half as just 21,400 sqm was completed during the first half year,
of the year, including lettings to the public sector, pushing none of which remains available. The prime rent remained
the anticipated full-year take-up to around 300,000 sqm. The stable at €22.00/sqm/month and is achieved in the West Bank
two largest lettings took place in new-build projects: DSD of the Rhein submarket. This is expected to increase to €22.50
(Duales System Deutschland) leased around 6,000 sqm and by the end of the year. The weighted average rent has already
the flexible office provider Design Offices leased approx. increased from €12.65 to €13.87 over the past 12 months.
Cologne: Office Space Market Areas with Rental Bands (€/sqm/month)
Auweiler Heimersdorf Har dt
Lindweiler
Pulh eim Pesch E31 Flittard
Esch/Auweiler
Longerich Dünnwald
A57
Ossendorf/ Stammheim
Ber gisch
Nippes Weidenpesch Höhenhaus Glad bach
Bocklemünd/Mengenich
Ossendorf € 6.50-11.50 Niehl
Other Locations
€ 6.00-11.50
Wid der sd or f Bilderstöckchen Mauenheim
Dellbrück
Widdersdorf
Mülheim
Brauweiler Nippes Holweide
Vogelsang Bickendorf Riehl
Neuehrenfeld
Köln
Buchheim Ben sber g
Lövenich Ehrenfeld/ Neustadt-Nord
Kalk/
Ehrenfeld Buchforst
Braunsfeld Mülheim
Müngersdorf € 6.50-15.50 Rhinebank-West € 13.00-22.00
€ 7.00-14.50
Merheim
Braunsfeld Höhenberg A4
Brück
Weiden Altstadt-Nord Kalk
Deutz
Peripherie West City Centre
€ 7.00-10.50 € 9.50-22.00 Deutz/ Neubrück
Buschb ell Altstadt-Süd Vingst
Lindenthal Messe Humboldt-
Gremberg
€ 9.50-19.00 Ostheim
Marsd or f Lindenthal/ A559 Rath/Heumar
Junkersdorf Sülz Neustadt-Süd
€ 8.00-13.50 Rath
Sülz Poll
Fo rsbach
Raderberg
Fr ech en
Bayenthal Gremberghoven
A1 Klettenberg Zollstock
Porz/
Westhoven
Bayenthal/ Gremberghoven
Marienburg Marienburg € 8.50-11.50
Ensen Eil
€ 9.00-15.00Raderthal A59
A3
Gleu el Rösrath
Finkenberg
Hür th
Rodenkirchen
Ber ren rath Porz
Rondorf Rodenkirchen Weiß
Urbach
Grengel
Kon rad er ho ehe € 7.00-10.50
A555
Hahnwald Zündorf
Sürth Elsdorf
Meschenich Immendorf Immendorf Godorf Wahnheide Köln/Bonn
Office Market Overview | 2nd quarter 2018 CologMunich
Development of Main Indicators
High demand is driving new-build activity
Total take-up was around 470,000 sqm in the Munich
office market over the first half of 2018, the highest level
for 10 years. Due to the continued high level of demand
for space, we have revised our full-year take-up forecast
up to 875,000 sqm. The most active submarket was the
City Centre (88,000 sqm) ahead of the East submarket
(76,000 sqm), whilst the sector statistics were dominated
by industrial companies (89,000 sqm) ahead of business
services providers (78,000 sqm). Vacancy has been falling over the full-year 2018, of which just under one fifth remains
since 2011 and is now down to 3.2%. Seven submarkets unlet. The prime rent has risen to €37.50/sqm/month with
have a vacancy rate of under 2%. As a result, there has been potential for a further rise by year-end. The average rent in
an upswing in new-build activity with 285,000 sqm more the market area is €18.00/sqm/month and €19.40/sqm/
office space under construction than in the same quarter month in the city area alone. Asking rents continue to rise,
the previous year. However, compared to the period of sig- even in the case of large-scale lettings. There were six lettings
nificantly higher new-build volumes from 2001 – 2002, the in the >2,500 sqm size category completed at rental prices
proportion of new-build space being prelet is now much in excess of €25.00/sqm/month in the second quarter alone,
higher. Just over 300,000 sqm is expected to be completed of which three were at rents above €30.00/sqm/month.
Munich: Office Space Market Areas with Rental Bands (€/sqm/month)
Rothsch waig e
Kar lsfeld Ism an in g
Speichersee
Ob erschleiß heim
Neu -Esting E45
Periphery-North
€ 8.50-14.00
Olch ing
North
Bezirk Nord A9
€ 12.00-18.50
Gr öb enzell
A99
A8 Olympiapark
€ 12.50-18.50 Kirchh eim
b. M ün ch en
Eichen au Poin g
Puch heim North-Schwabing Gr ub
Bezirk West € 14.50-23.00
West Heim stetten
€ 13.00-20.00
Arabellapark
Bezirk Mitte City Centre € 15.00-21.00
€ 19.50-37.50
A94 Parsdo rf
Bogenhausen Riem Periphery-East
Mü nch en
€ 18.50-28.00 Moosfeld/ € 8.50-13.00
Westend
Riem Ottend ich l
€ 14.00-22.00
€ 9.50-16.00
Ger merin g East
Gr äfelfing A96 Bezirk Ost
€ 13.00-23.00
Periphery-West
Haar
€ 8.50-13.50 Martin sr ied
Planeg g
Vaterstetten
South Neuperlach
Bezirk Süd
€ 11.00-18.50 € 10.00-15.00
A95
Stockdo rf
A995
Neu b ib erg
Periphery-South
Gau tin g € 8.00-12.00
Ottob ru n n
Unterb ru nn Unterh ach in g
Gr ün wald
Office Market Overview | 2nd quarter 2018 MunichStugart
Development of Main Indicators
Take-up performance driven by large-scale
owner-occupier projects
In the second quarter, total take-up was around 29,000 sqm
in the Stuttgart office market, the lowest second quarter
take-up of the last 10 years. Total take-up in the first half
year was around 118,000 sqm, thanks to two large-scale
owner-occupier deals in the first quarter with an aggregate
volume of around 61,000 sqm of office space. However the
increasing scarcity of supply resulted in far fewer deals
compared to the same period the previous year (-14%) onto the market in 2018, just 11% is still available. As a
and compared to the 5-year average (-33%). Full-year take- result of the lack of completions in the first half of 2018,
up in 2018 is expected to be below-average at around the vacancy rate fell by 0.1% compared to the previous
220,000 sqm. The large-scale project by Bosch in the quarter, to 2.3%. A further fall to 2.2% is expected by
Feuerbach submarket contributed around 51,500 sqm, year-end 2018. The scarcity of supply has also resulted
which equates to a share of 44%. The second most active in a further increase in prime rent which has risen by
submarket was the City Centre, where almost half of all €0.50/sqm/month compared to the previous quarter to
letting transactions took place in the first six months. Of €23.50/sqm/month. The prime rent is expected to reach
the approx. 84,300 sqm in the pipeline and due to come €24.00/sqm/month by the end of the year.
Stuttgart: Office Space Market Areas with Rental Bands (€/sqm/month)
Hirschland en Neu wirtshau s Mühlhausen Kor b
Neuwirtshaus Hofen
ZuffenhausenRot Freiberg Neugereut
Kor ntal-M ün chin gen
Zuffenhausen
€ 8.00-11.00 Steinhaldenfeld Waibling en
Klein hep pach
Ditzin gen
Münster
Hoefing en Bein stein
Hausen Burgholzhof
Feuerbach Sommerrain
Geb ersheim Weilimdorf Stuttg art Fellbach
Weilimdorf € 10.50-16.00 Bad Cannstatt
Feuerbach € 10.00-16.50 Weinstad t Rem shald en
€ 10.00-13.00
Giebel Ker nen
Wolfbusch Stuttgart-North im Remstal
Bergheim Bad Cannstatt
Ger ling en € 12.00-17.50
Stuttgart-
Leon b er g
Nord
Stetten
Europaviertel Luginsland im Remstal Schn ait
Kernerviertel
Rotenberg
Universität Stuttgart-Ost Untertürkheim
Botnang Hauptbahnhof
Oberer Schlossgarten Stru em pfelbach
Neue Vorstadt Diemershalde
Stuttgart- Stuttgart-West City-Centre Stuttgart-East Uhlbach
Rathaus
West € 11.00-16.50 Heusteigviertel
€ 13.50-23.50 € 10.00-15.00 Wangen
Dobel
Unter-Obertürkheim/
Warm bro nn Wangen-Hedelfingen
Stuttgart-South Frauenkopf
Stuttgart-Süd € 9.00-15.50
€ 10.00-16.50 Rohracker
Hedelfingen Obertürkheim
Lederberg
A81 Büsnau
Degerloch Sillenbuch
Heumaden
Sonnenberg
Mag stadt Kaltental Degerloch
Vaihingen € 9.50-16.50Schönberg
Esslin gen
Hoffeld am Neckar
Hoffeld
Vaihingen-Möhringen
Riedenberg
A831 € 9.50-17.50 Ostfild ern
Möhringen Asemwald
Birkach
Rohr Kem nat
Dürrlewang
Ploch ing en
Steckfeld
Fasanenhof Hohenheim
Sind elfin g en Plieningen
Fasanenhof
€ 9.00-10.50
€ 11.00-15.50 Plieningen
Leinfelden -E chterd ing en Leinfelden-Echterdingen A8
Den kend or f
Böb ling en € 9.50-18.50 Neu h au sen Wern au
au f d en Wend ling en (Neckar )
Filder n am Neckar
Office Market Overview | 2nd quarter 2018 StugartContacts
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
Team Leader Office Leasing Team Leader Office Leasing 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 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
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