E & G The 2017-2018 Office Market Report

16 I Developments in 2017/2018
Developments in 2017/2018 I 17
Vacancies reach critical level.
At some 2.1% the vacancy rate to 31.12.2017 dropped to one of the lowest levels ever recorded since
the relevant statistics have been kept. Overall only approx. 167 000 m² of office space was still available
for letting at short notice. High-quality space is in the shortest supply of all.
Declines in almost all submarkets
Space is currently scarce not only in
the central business district and city
centre but elsewhere too. Demand in
peripheral locations also continues to
outstrip supply. The choice of premises
available to companies searching for
office space which is available at short
notice is very limited. In some cases
this results in existing letting contracts
being extended because no suitable
alternatives are available. Results can
be optimized by using the services of
a consultant. Leinfelden-Echterdingen
experienced the largest decline, some
46.8 %. This was, however, primarily
due to the fact that upcoming fire protection
measures meant that a larger
administrative building with almost
15 000 m² of space was no longer available
for short-notice letting. The supply
of office space in the city centre fell
by around 43.6 % to a mere 21 900 m²,
while only approx. 22 000 m² are available
in the central business district.
This space is located in a diverse range
of buildings, larger contiguous spaces
are virtually non-existent.
Outlying districts offer more
project opportunities
In the next two years companies looking
for larger plots will increasingly
focus on the outlying districts, since
they offer many more opportunities
for corresponding development
projects. This will, in turn, result in
further price rises in these areas.
No significant expansion of space is
expected in the central business district
and city centre in the next two
years, with the situation unlikely to
improve until after 2020, when new
projects come on stream. The new
buildings currently under construction
will not provide more than 15 000
m² vacant space in the short term.
Completion volume in m²
Completion of building Pre-let
42,000
23,200
45,900
41,200
37,000
36,300
81,200
62,700
72,500
33,600
81,900
69,500
149.200
119.300
128.600
110.500
109.600*
64.300*
180.800*
121.000*
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
* foreseeable completions/pre-lets
Vacant office space as of 31.12.2017 and percentage change over 2016
– 19.0 %
Stuttgart-City
–
– 30.2 %
–
+ 14.2 %
+
– 11.8 %
– 4.3 %
– 3.6 %
+1.3 %
–
–
Total
167,000 m 2
–
–
+
– 46.8 %
– 39.0 %
–
– 43.6 %
–
Source for both diagrams: Research E&G Real Estate GmbH ©, current as of: 31.12.2017