Greif & Contzen analysed Cologne’s office space market in the first six months of the current year.

2024 has been a meagre year for Cologne’s office space market to date. No large units were taken up, take-up dropped to around 60,000 square metres – a fifth less than what was taken up in the already weak first half of 2023. This means that the office space market has been far from matching the ten-year average in the past year and a half. This development is also reflected in the vacancy rate: the currently around 309,000 square metres of vacant office space correspond to 3.8 percent of the city’s stock of space. This keyfigure stood at 3.4 percent at the end of 2023.

Slight upturn in the months ahead
However, Andreas Reul, Head of the Office Properties Division of Greif & Contzen Immobilienmakler GmbH expects a slight upward trend in the next few months. “A number of large units are likely to be taken up in the second half of the year,” Reul points out. The biggest unit taken up this year to date has a size of just 3,500 square metres.

Slight decrease of rents
When it comes to letting, many companies are currently reluctant and very price-aware. The economic situation continues to be characterised by uncertainty, after all. “Those who are looking for space need to take new requirements into account, causing them to frequently question and postpone their search,” says Reul. Only a few large units in new and refurbished buildings – where rents are higher – were taken up in 2024 to date, and the low to mid-price segments have played an important role in the office space market. “When letting older, non-refurbished premises it is, however, not possible to realise high rents. It is still feasible to obtain high rents for premium-quality premises, but only few of those were let in the first half of the year,” Andreas Reul explains. As a result, the prime rent dropped from EUR 33.00 in 2023 to EUR 32.00 in the first half of 2024. The highest rent realised was EUR 38.00. The average rent weighted according to unit size decreased from around EUR 19.60 per square metre at the start of the year to now EUR 18.90.

Market on hold
With their reluctant stance, businesses have put the office letting market on hold, too. The real estate experts from Greif & Contzen are counting on the second half of the year, expecting the office space market to recover in line with the recovery of the economic situation in the months ahead. If larger and more expensive office units are then taken up once again, the level of rents will also remain stable. Andreas Reul is confident that “a few large units will be let or taken up by owner-occupiers”. However, he clarifies that it is unlikely that the previous year’s result can be matched at this point.