Office letting market Hamburg 4Q2023: Declining willingness to choose new offices in 2023

As Grossmann & Berger had predicted at the end of the 3rd quarter, the total take-up of Hamburg office space for the year was 455,000 m². This figure falls 5 % below the five-year average of 479,000 m². Compared with the strong result in 2022, take-up of space is down by 19 %. “In 2023 the trend towards better quality became established, as may be seen from the year-on-year growth in premium rents. Overall, however, circumstances on the office-letting market have grown more difficult, and in the year just gone by businesses were appreciably more reluctant to make a decision than in 2022,” says Andreas Rehberg, spokesperson for the management board of GPP-member Grossmann & Berger.

office letting market hamburg in detail: 

• In the size category 5,000 m² or more, take-up dropped by 28 % to 144,000 m². The number of large-volume contracts concluded fell from 19 to 16. With the exception of the construction start for police headquarters at Bruno-Georges-Platz 2 in City North (7,100 m² of space), no owner-occupier agreements were noted in this size category. Whereas the biggest office suite leased in 2022 was 40,000 m² in size (Dataport), this year’s largest lease was for 22,200 m² (Hamburg Port Authority HPA).
• The proportion of owner-occupiers was unchanged year on year at 11 %. HPA’s purchase of the “New Work Harbour” at Strandkai 1 comprised about 45 % of the total owner-occupier take-up of 50,000 m².
• Year on year the average rent softened by some 2 %, partly because more than half of office lettings in the over 5,000 m² sector were outside City and HafenCity. Only in the City and HafenCity sub-markets did the average rent for properties of all sizes rise, increasing by 60 cents to €27.50/m²/month.
• The amount of space available at short notice grew significantly by 17 % year on year. Consequently the vacancy rate leapt from 4.0 % to 4.6 %. “Compared with the past twenty years, this is still a healthy amount that gives tenants a real choice,” says Rehberg.
• Completion of some developments was delayed in 2023. The year thus closed with a projected completion volume of 432,000 m² for 2024 and 2025 in 44 different developments. At present around 155,000 m² of new office space is being built on speculation.