Savills' latest green office bulletin reports that in both leasing and investment market demand for 'green' office space has risen significantly over recent years.
The annual take-up of 'green' office space in the top five German markets (Berlin, Düsseldorf, Frankfurt, Hamburg and Munich) has tripled from approximately 50,000 m² on average between 2005 and 2008 to 150,000 m² in 2009/2010.
With 1.1 billion generated from sustainable office buildings on the German investment market in 2010 the transaction volume was more than four times higher than in 2007 (approx. 0.2 billion) according to Savills researchers, and the share of this turnover in the total office investment volume rose from approx. 1% to about 14% during this time. The international real estate advisor suggests that both trends highlight that sustainable offices are no longer a niche product but will become market standard.
Savills survey examines over 100 office buildings in Germany with LEED or DGNB certification (including pre-certificates). The lettable space of these properties totals approx. 2.15 million m² or approx. 0.5% of the total German office stock. According to Savills the three cities featuring the largest 'green' office stock in Germany are Frankfurt (approx. 460,000 m²), Munich (approx. 380,000 m²) and Hamburg (approx. 300,000 m²) but in several smaller cities green market offices makes up a greater proportion of the total stock.
Savills research reveals that over 9% of the office stock in Dessau (Saxony-Anhalt) is certified as sustainable, with one single building the Federal Environmental Agency accounting for the total space. Two further regional cities Erlangen (approx. 5%) and Ravensburg (approx. 4%) - are ranked next above Frankfurt (approx. 4%), which, in fourth place, is the first of Germany's top five markets.
Savills researchers suggest that take-up figures in Germany's top five markets are proof that the sustainability of office space is becoming increasingly important to occupiers in Germany. Between 2005 and 2010 the letting volume of 'green' office space in these top five markets reached approximately 560,000 m² out of a total 16 million m² of office space, according to Savills figures, hence sustainable office space accounted for 3.5% of the total take-up in this period.
Furthermore a clear upward trend can be demonstrated by comparing the share of green office building take-up in Germany's top five cities in 2005 (0.6%) with the same figure in 2009 (9.7%). The international real estate advisor's research shows that the most demand for sustainable offices has come from business consultancies and companies in the financial services sector.
Matthias Pink, Head of Research Savills Germany, says: "Investors are increasingly focusing their attention on certified buildings, not least due to the rise in occupier demand for such properties.
"Particularly in the core investment market green building certification is becoming a crucial factor and the majority of new developments in Germany's five major markets are already built with a view to gaining sustainability certification, so there is a clear indication that green buildings are moving from niche to market standard. It may well be that in a few years' time green buildings will no longer be an issue because certification is taken for granted."