OFFICE INVESTMENT VOLUME DECREASED ANEW: INVESTORS REMAIN CAUTIOUS
-
In the first half of 2024, a good €2.2 billion was invested in office properties in Germany. Compared to the previous year, this represents a further decline of 31%, which is also the weakest result in the last 15 years. The 10-year average was missed by around 75%.
-
In contrast to most other asset classes, there is still no discernible upward trend in transaction volumes for office buildings. As a result, their share of total commercial real estate volumes has fallen further and currently stands at just 18%. This implies that office properties now only occupy third place in the asset class ranking.
-
The share of portfolio transactions amounts to almost 10 %, around five percentage points below the long-term average.
-
The persistently difficult situation is attributable on the one hand to the weak occupier markets, primarily due to the slow economic recovery, which is contributing to uncertainty about the further development of the office markets. On the other hand, many investors are also adopting a cautious stance with regard to the final price trend.
-
As expected, the stabilization of prime yields that began in the first quarter has continued. Thus, no changes were observed. In the A locations, they remain unchanged at an average of 4.36%. Munich remains the most expensive location with a prime yield of 4.20%, followed by Berlin and Hamburg with 4.25% each.