Office market Stuttgart 3Q/2021: Take-up at approximately 86 500 m²

As of 30 September 2021 the take-up figure for Stuttgart’s office market was approximately 86 500 m² and thus some 12 % lower than the previous year’s results.

In the third quarter there was a continued lack of major deals, with the letting of some 2 974 m² of office space to the State of Baden-Württemberg in the first quarter remaining the largest transaction to date. The largest deal in the third quarter was for around 2 482 m² rental space at Ulmer Strasse in Stuttgart-Wangen, which was let to the City of Stuttgart. A slight recovery in demand was, however, observed, primarily in the small and medium space segments. In total 179 letting contracts were concluded in the period to 30 September 2021; this figure was already more than the total for all 2020.

The strongest demand came from the IT and Telecommunications sector, with take-up of around 18 500 m² or 22 % of the total volume. This segment was followed by the IT and Telecommunications sector (14 %) and Consultants (13 %).  In terms of location, the highest rental take-up was achieved in Stuttgart’s central business district, at around 21 600 m², and the city centre, at around 18 600 m². In the peripheral areas the southern submarket of Stuttgart Vaihingen was the most popular, with some 17 600 m² of space let.

As of 30 September 2021 there was a total of 269 500 m² vacant office space available at short notice, an increase of some 62 % over the comparable period in the previous year. With a total available area of approximately 8.25 million m² this represents a vacancy rate of 3.3 %. Space which was vacated by large corporations already played an important role in 2020, particularly with regard to the Leinfelden-Echterdingen submarket. Further large vacant spaces are expected in 2022, particularly in Stuttgart Möhringen. There has been only a slight rise in the availability of sub-let space, while the completion of some planned projects has been postponed. In the period 2021 and 2022 a completion volume of some 245 100 m² is expected, of which 74 % has already been pre-let.

The prime rent as of 30 September 2021 remained stable at EUR 25.00/m² while the average rent for all Stuttgart was EUR 15.70/m², some 4 % lower than in the previous year. This was primarily due to the letting of space in older existing buildings in peripheral locations.

A number of large-scale letting contracts may be concluded by the end of the year, which would result in take-up levelling off at between 130 000 and 150 000 m². This would be a similar figure to the one achieved in 2020.