Overview of the office market in Vienna
Executive Summary
The upturn in production of new space is giving the market a new boost. Over the course of the year, we will see whether the increased construction activity is reflected in an improved letting performance.
In 2024, the volume of completions has already doubled com- pared to the previous year. This positive trend will continue in 2025 with 111,000 sqm of newly created office space. This will increase the supply of high-quality first-time occupancy space, which will lead to a moderate increase in the currently very low vacancy rate of 3.3 per cent in the short term. Production of new space & vacancy rate
Letting performance The low supply of first-time occupancy space and the subdued economic outlook led to a comparatively low total letting performance of just 165,000 sqm in the previous year. We are forecasting a moderate increase for the current year, which is attributable to the up- coming completions.
Stable rent prices The rent increases recorded in the recent past have now stabilised. The prime rent currently amounts to EUR 28.50/sqm. The still limited supply of modern office space in prime locations continues to exert significant pressure on rent levels.
The current turbulent economic policy situation in Europe and the subdued GDP development compared to the USA and China are affecting the European real estate markets on many levels and are currently often leading to a delay in investment deci- sions by investors. This naturally also affects the Austrian investment market. Howev- er, following a significant decline in transaction volumes in 2023 and 2024, there has been a slight trend reversal since the beginning of the year. Investor interest and ap- praisal activity are slowly returning, meaning that a significant increase in transaction activity is expected for 2025, even if this is not yet reflected in the volume figures. Investment
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Office Market Report
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