Office Market Overview - Big 7 | 4th quarter 2018 January 2019 - JLL
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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 2
space. 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 3
falling 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 4
For 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 5
Vacancy 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 6
Berlin 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 Berlin
Düsseldorf 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 Düsseldorf
Frankfurt 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 Frankfurt
Hamburg 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 Hamburg
Cologne 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 Cologne
Munich 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 Munich
Stuttgart 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 Stuttgart
Contacts 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 jll.de/immo Commercial real estate properties for sale or to let througout Germany Copyright © JONES LANG LASALLE SE, 2019. No part of this publication may be reproduced or transmitted in any form or by any means without prior written consent of Jones Lang LaSalle. It is based on material that we believe to be reliable. Whilst every effort has been made to ensure its accuracy, we cannot offer any warranty that it contains no factual errors. We would like to be told of any such errors in order to correct them.
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