Berlin office market: vacancies are rising, rents are exploding – what now?

Berlin office market: vacancies are rising, rents are exploding – what now?

The office real estate market in Berlin will show a more tense situation in the first quarter of 2025. The vacancy rate for office space has increased to 7.7%, a significant increase compared to the 882,200 square meters that were vacant at the beginning of 2023. There are currently 1,820,100 square meters of office space available, which underlines the need for innovative space concepts to attract tenants. Loud Moz.de The vacancy rate in prime locations such as Potsdamer Platz is particularly high at almost 15%, while Südkreuz is an attractive location with only 1.7% of vacant space.

Prime rents in Berlin have developed significantly in recent years. In top locations, these rose from 24.30 euros per square meter ten years ago to 47.50 euros at the beginning of 2025. Up to 49 euros per square meter are paid at Potsdamer Platz and Leipziger Platz. Demand is increasingly focused on modern spaces and first-class locations within the S-Bahn ring Engel & Völkers.

Changes in the market

Economic uncertainty has led to rental behavior in which many companies rent their space below market value because there is no growth in personnel. Tenants want offices that go beyond the advantages of working from home. Important elements are relaxation areas, massage chairs and roof terraces to achieve greater attractiveness. In addition, materials in offices were found to play important factors in reducing sickness absence.

The construction of the “Spandauer Ufer” project at the Berlin-Spandau ICE train station is scheduled to be completed by 2029/2030. This project includes a 20-story office tower that will provide flexible offices, including lecture theaters and leisure activities such as mini golf. These new office spaces must meet the increased requirements for equipment and sustainability in order to remain attractive.

Prospects for stability

Despite the current challenges, a stabilization of the Berlin office property market is forecast for 2025. Loud Engel & Völkers Rent levels are expected to continue to rise moderately, while the vacancy rate is expected to rise more slowly. There are tenant inquiries for space over 3,000 square meters, but hesitant decisions due to the economic situation could weigh on the market.

In summary, the Berlin office real estate market remains dynamic and faces the challenge of adapting to new employee needs while also trying to reduce vacancy rates and attract tenants to these innovative office spaces.