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Sound quarterly figures for the Hamburg Office Market

Letting volume is at 105,000 m² in the first quarter  |  Empty properties are down  |  Top rents are stable

The Hamburg office space market is looking healthy at the start of the year. In the first quarter of 2014, approximately 105,000 m² of office space was let, and around a third of this can be attributed to owner-occupiers. The result for the quarter is therefore up on the level of the previous year (first quarter 2013: approx. 102,000 m²). In the ten-year comparison, this figure is around 8% higher than the 97,400 m² average.

According to the analysis of the international consultancy firm Cushman & Wakefield, the result was significantly impacted by tenancy agreement conclusions for property sizes up to 1,000 m². These accounted for about 38% of the surface area turnover. Till Haubrich from the Hamburg Office Lettings Department of C&W explained: "The demand for small surface areas below 1,000 m² is, as usual, high and forms a solid basis for the Hamburg office market.“ For the size category between 1,000 and 5,000 m², letting activities have been relatively slow to date. Haubrich added: "For the surface area segment of 1,000 m² and above, there is a clear shortage of properties in the sought-after city-centre locations. For want of an alternative, prospective tenants will increasingly have to make do with other locations and/or sub-markets.“ Two owner-occupier deals for more than 10,000 m² also helped boost the surface area turnover.

Most letting transactions concerned the city-centre sub-markets. HafenCity and the City accounted for approximately 38,700 m² in total, which is equivalent to approx. 37%.

The top rent is at 24 euros per m²/month. For more than a year now, this has shown itself to be stable. Taking into account the shortage of properties in central locations, rents look set to rise by the end of the year under upwards pressure.

At the end of March, the office space stock amounted to around 14.4 million m², of which 1.12 million m² was available at short-notice. The empty property rate fell again from 7.9 % in December 2013 to 7.8 % at the end of March 2014.

Building completions of new office space in the metropolitan area of Hamburg amounted to around 18,000 m² of space in the first quarter 2014. Around 282,000 m² of space is currently under construction, of which 129,000 m² is planned to be completed in 2014.

At the start of the year, the Hamburg office market appears to be in good shape. Inga Schwarz, Head of the Research Department at C&W Deutschland: "Last year we turned over a total of 434,000 m² of space. We can count on the result being even higher this year."