At the end of the 3rd quarter of 2015 take-up of office space in Hamburg had reached a total of some 355,000 m². Year on year, therefore, take-up fell by around 7%. Some 104,000 m² of office space was let or taken by owner-occupiers in the 3rd quarter, about 20,000 m² less than in the first two quarters. Turnover of space was calculated without regard to the unusual situation caused by the pressure to accommodate refugees and the consequent take-up of commercial space. “The rate at which commercial space is absorbed in order to house refugees is likely to rise between now and the end of the year. More than 15,000 m² of office space in Hamburg has already been rented for this purpose,” says managing director Andreas Rehberg
of the current market position.No agreements signed for more than 5,000 m² in the third quarter
In the first three quarters of the year six transactions involved more than 5,000 m² of space; four of these were closed by owner-occupiers. The biggest trade remained the purchase of a section of the former Axel-Springer complex, which the City of Hamburg bought in the 1st quarter to provide the Borough Council of Hamburg-Mitte (Caffamacherreihe 3, City) with 32,000 m² of offices. The City of Hamburg likewise accounted for the largest rental contract of the year, with a second-quarter agreement to take some 19,400 m² for the regional tax offices of Bergedorf, Oberalster and Wandsbek and the tax office for large enterprises (Nordkanal Strasse 22+24, City South). Grossmann & Berger was involved in both transactions in a consulting role. Year on year, however, while the number of agreements for large amounts of space fell from eleven to six, the share of turnover posted by leases for 500 m² or less rose to about 64%. Around 86,000 m² of space let fell into this size category.Central locations account for around half of all agreements
Returning to their traditional places in the ranking of sub-markets, the central districts of City, HafenCity and City South together accounted for 56% of take-up of space at the end of the 3rd quarter and some 52% of all agreements signed. First-placed City was far ahead of the other sub-markets, with 33% of take-up (116,000 m²) and 36% of all agreements. This good result was partly due to the owner-occupier transaction with Hamburg-Mitte Borough Council and four agreements for premises in the 2,001 to 5,000 m² size category. For example Thjnk, an advertising agency, rented 4,900 m² in the “BOA VISTA” project (Vorsetzen 32-39) and the private bank Donner & Reuschel chose some 2,300 m² in the “Europa Passage” mall (Ballindamm, City). City South placed second with a share of about 15% (54,000 m²) and HafenCity was third with around 8% (27,700 m²).Local government plays leading role
Due to the City’s large transactions to obtain space for Hamburg-Mitte Borough Council and the four tax offices, local government/public offices accounted for around 24% of total take-up, thus forming the biggest single group of new occupiers by the end of the 3rd quarter. Consulting firms were also very active on the market, accounting for around 17% (60,000 m²) of lets.Premium rent slips a little, average rent stable
Year on year the premium office rent slipped back by 50 cents to €24.00/m²/month. Weighted by amount of space taken, the average rent stayed as it was in the prior year at €14.50/m²/month. In the past three quarters the largest share of take-up of space, some 20%, fell to properties renting for between €12.51 and €15.00/m²/month.Vacancy rate less than 6%
Year on year the amount of space standing empty fell from around 839,800 m² to its current figure of about 740,300 m². At the end of the 3rd quarter the vacancy rate, including sublet space, was a mere 5.6% of the total stock of office space of 13.3m m². “Of the 20 biggest agreements concluded on the market for offices in Hamburg, seven related to project developments, three are under construction for owner-occupiers. The considerable demand for efficient office space offering new-build standards cannot be satisfied with the rate of completions seen so far. This year and in the coming year, 2016, some 48 projects are expected to add 388,000 m² to the total stock of office space; however, contracts with new occupiers already exist for some 64% of this space. Many firms are already reserving their office space in new projects. High-quality new-build projects now have good chances on the rental market,” adds Rehberg
.Projected take-up for the year is 500,000 m², slightly lower than 2014
“Projected take-up for the year 2015 will in all probability be slightly lower than the year before. Our view is, however, that the market for office space in Hamburg is still in a phase of very dynamic growth. Many companies are planning strategic overhauls, which often involve moving to different premises. However, these are complex processes, so that they often take quite a long time to mature,” says Rehberg
, describing the market’s present state.
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Permission is given to reproduce the chart (source: Grossmann & Berger).