Overview of the office market in Vienna
Executive Summary
Greater demand for rentals The volume of new office rentals totalled 170,000 sqm in a difficult market environment in 2021. Due to increasing dynamic developments as of late, take-up can be expected to either remain stable or increase slightly in 2022 as a whole. Vacancies remain at a record low The low production of new space in recent years has led to a steady decline in the vacancy rate, and the current rate of only 4.3% marks an extremely low level in international comparison.
Rents I First-time occupancy**** (in EUR/sqm per month) Prime location 18.0 - 26.0 Quality location 13.5 - 18.0 Standard location 10.0 - 13.5 Prime rents 26.0 The interest of core investors in office properties with long-term rentals at top locations remains strong. German and Austrian institutional investors are the main demand drivers here, whereby the very limited pipeline has had a negative impact on the offering. Production of new space influenced by refurbishments At approximately 126,000 sqm, production of new space was once again substantially higher than du- ring the first quarter of the previous year (Q1 2021: approx. 66,700 sqm). Of special note is the extraor- dinarily high share of refurbishments, which account for 82% of new space production at the moment. Investment
Demand* | Supply 2022 Production of new space
126,100 sqm 180,000 sqm
Take-up*
Market indicators Production of new space
increasing
Economic data for Austria 2021/2022*
Take-up
stable
Vacancies
slight downward trend
Austria 4.9 % EU 6.4 % Eurozone 7.0 %
Unemployment rate (Eurostat)
Prime yields
3.0
Rental prices Average rents
Nom. GDP EUR billion
403.4 4.1 % 2.8 %
slightly increasing slightly increasing
Economic growth
Prime rents
Inflation rate
* Forecast ** All indicators are based on the total market (old and new buildings), unless indicated otherwise *** According to the Vienna Research Forum,www.viennaresearchforum.at **** EHL Rent Index of 100 existing and/or refurbished office buildings at various locations
Office supply
Total market**
VRF***
Office space in sqm
11,486,050 5,931,993
Vacancy rate
4.3 %
4.2 %
Source: EHL Market Research | Q2 2022
Office Market Vienna 2018 - 2022
300,000 sqm
8 %
270,000
260,000
220,000
210,000
225,000 sqm
7 %
180,000*
170,000
150,000 sqm
6 %
126,100
125,000
66,700
75,000 sqm
5 %
45,000
4 % Vacancy rate
0
2018
2019
2020
2021
2022
3
Deliveries in sqm
*Forecast, Source: EHL Market Research | Q2 2022
Take-up in sqm
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