According to Savills research Q2 11 take-up in the office markets of Berlin, Dusseldorf, Frankfurt, Hamburg and Munich totaled over 717,000 m² and exceeded Q1 by 12.5%. Furthermore H111 take up was approximately 1.36 million m² of office space marking a 13.7% increase compared to the same period of last year.
Robert Kellershohn, Managing Director Office Agency at Savills, says: "The German office markets gained further momentum in Q2 2011. We are seeing significant increasing demand for office space across the board."
The international real estate advisor reports that almost all of the markets were ahead of their H1 2010 results. Munich performed particularly well and saw a very strong second quarter. In terms of the first six months of 2011, take-up in the Bavarian capital increased by 44% year-on-year. In Hamburg (+21%), Berlin (+18%) and Frankfurt (+6%) the letting volumes were on the rise, too. Solely in Düsseldorf take-up declined compared to the previous year (-29%) however, this result is primarily due to the Vodafone letting of last year.
The increasing demand is reflected in rental levels, Savills says. The average rents, which had already been at high levels against long-term comparables remained largely stable in four of the five markets. Düsseldorf even saw an increase of the average rent by circa 10% compared to the previous quarter. Prime rents, which in many places stood close to their five-year average, likewise remained unchanged in most of the markets.
Solely Hamburg recorded a slight decline from 23.90/m²/month in the previous quarter to 23.00/m²/month at the end of H1. In Munich the significant rise in take-up in turn had a noticeable effect on prime rental levels. Compared to the previous quarter the prime rents increased by just below 4% to 30.30/m²/month and hence passed the 30 mark for the first time since the end of 2009.
In terms of vacancies the situation changed only slightly throughout the past three months with the average vacancy rate of the five markets falling from 10.6% to 10.4%. The situation in the individual markets, however, varied: Düsseldorf recorded a slight increase, the vacancy rate in Munich was virtually unchanged while in the remaining three markets it dropped by approximately 0.5 percentage points each.
Kellershohn adds: "Despite high vacancies to date which are unlikely to reduce significantly in the further course of the year investors in all markets are increasingly willing to approach speculative developments."
Given the positive economic outlook, Savills predicts that take-up levels will continue to be positive with a total 2.5 million m² likely to be exceeded.