Berlin office market: No all-clear for 2027

More space let, but no cause for complacency in the Berlin office property market. Whilst major letting deals are boosting take-up in 2026, buildings with outdated facilities and in less sought-after locations are coming under increasing pressure. Companies are scrutinising their space requirements more closely, letting processes are taking longer, and owners are having to invest more heavily in their buildings. These are the key findings from the online press conference “Between Growth and Vacancy: How is the Berlin office property market developing?”, attended by Martin Schubert, Head of Letting Management Berlin at HIH Real Estate; Jan Trenn, CEO of CELLS; Mareike Lechner, Board Member of immobilien-experten-ag.; Alexander Lackner, CEO of neworld; and Heiko Maaß, Head of Domestic South/East at Berlin Hyp.

According to the market reports cited by Martin Schubert, office space take-up in Berlin totalled approximately 550,000 square metres in the first three quarters of 2026. For the year as a whole, he expects the figure to be well above 600,000 square metres. This would mean the market would exceed the previous year’s result of just under 500,000 square metres. Jan Trenn, however, urges a nuanced view. Individual large-scale deals, including the lease of around 40,000 square metres by Berliner Verkehrsbetriebe, have had a significant impact on the result. “The higher take-up is encouraging, but it is largely driven by a few large individual deals. We are still a long way from the annual take-up figures of over one million square metres seen before 2020,” says Trenn.

The rise in letting activity does not by any means mean that deals are any easier for investors and owners. Companies often scale back their space requirements even whilst lease negotiations are still underway and expect offices to be tailored to their individual needs. “It has become more difficult, and we have to provide significantly more advice. There is no one-size-fits-all solution. What matters is what the building has to offer and what the company in question actually needs,” says Schubert. There is demand for bright, flexible spaces with areas for interaction and collaboration. Added to this are requirements regarding cooling, energy efficiency and good accessibility.

Trenn reports that negotiations can sometimes take up to a year and a half, from the initial contact right through to the signing of the contract. At the same time, expectations regarding rent-free periods and fit-out grants are on the rise. “Our biggest competitor when it comes to letting new tenancies is currently the existing landlord. As soon as a tenant considers moving out, every effort is often made to keep them in the building,” says Trenn. When letting new tenancies, owners often have to make substantial investments in order to be able to offer their premises at market rates again.

For CELLS, prime locations with high-quality buildings remain particularly attractive. In such locations, tenants are prepared to pay higher rents per square metre for less floor space. In the Berlin project ‘FÜRST’ on Kurfürstendamm, initiated by CELLS – for which CELLS continues to act as a service provider for all planning-related services – the company focused on combining office space with retail, hotels, healthcare and leisure facilities. This has enabled office rents there to be set well above the market average. Roof terraces and communal areas further enhance the quality of the environment.

According to Mareike Lechner, the Adlershof Technology Park – the largest of its kind in Germany – demonstrates that independent office markets can thrive even outside the city centre. immobilien-experten-ag. is developing the “AM OKTOGON” campus there, where eleven new buildings have already been constructed, as well as the “OFFICE LAB CAMPUS” with around 26,000 square metres of lettable space. “Adlershof is not just any random outlying area of Berlin, but a specialised location home to around 1,300 companies, 18 scientific institutions and the natural sciences faculties of Humboldt University. Our tenants are often looking for more than just a traditional office, such as additional laboratory, testing or showroom space,” says Lechner.

According to Lechner, net basic rents for new-build offices on the “AM OKTOGON” campus range from 16 to 20 euros per square metre, whilst on the “OFFICE LAB CAMPUS” they range from 21.70 to 22.10 euros, depending on the location within the building. Customisable floor plans, high energy and space efficiency, as well as links to public transport and the motorway, and the short distance to BER Airport, are key location factors. “We are seeing a stable market in Adlershof. The location does not follow every upward surge in growth, nor does it experience every downward dip. Berlin is more than just its city centre. Furthermore, there are also many people who work in Berlin but live in the affluent suburbs and are glad not to have to commute all the way into the city centre,” says Lechner.

In the flex-office market, too, it is the combination of location and quality that counts. neworld is the main investor in the operator Scaling Spaces, which offers fully-fitted offices with complementary services and flexible contract terms. According to Alexander Lackner, the six Berlin locations – out of a total of twelve in Germany – achieve an average occupancy rate of more than 80 per cent. “In prime office locations, our occupancy figures are stabilising and rising again. Even with flexible offerings, customers are not willing to compromise on building quality, service or public transport links,” says Lackner.

Demand comes predominantly from established small and medium-sized enterprises, as well as well-established start-ups. In addition to shared spaces, there continues to be demand for private, self-contained offices. “Flex Office is part of the solution for today’s office landscape. Small and medium-sized enterprises in particular need flexibility and are prepared to pay more for short-term contracts and a comprehensive service,” says Lackner. He expects the segment to continue to grow as a complement to the traditional office.

The economic climate remains challenging for both new-build and regeneration projects. High construction costs are compounded by a competitive lettings market and increased financing costs. “It is currently very difficult to finance a speculative new office development in a secondary location in Berlin. We focus primarily on whether the rental income is realistic and whether interest and capital repayments can be reliably met,” says Maaß. For new-build project developments, the required level of pre-letting tends to be in the region of 50 per cent. This also serves as a market test for the planned product.

Environmental performance also remains a key consideration for lenders. “When it comes to existing properties, we need a clear understanding of how CO₂ emissions can be reduced. A great deal can already be achieved through smart control systems, heat pumps or connection to green district heating,” says Maaß.

Speakers are predominantly cautious about the coming twelve months. In view of further completions in 2027 and 2028, Schubert anticipates additional vacancies and pressure on average rents. “When it comes to prime rents, however, we expect stability or even slight increases. The trend towards high-quality space – the so-called ‘flight to quality’ – is continuing,” says Schubert. Trenn and Maaß also point to space that is already unused but still under contract, for which subtenants are being sought. This could place further strain on the market.

In the long term, uncertainties arising from the use of artificial intelligence and changing requirements for office workspaces will also come into play. According to the speakers, it remains to be seen how significantly this will affect space requirements. Lechner sees continued development potential for Berlin as the capital and advocates assessing investments over longer timeframes. Maaß remains cautious about short-term developments. “I expect stabilisation rather than an upturn. Vacancy rates will remain high, and the differences between prime locations and structurally weaker areas will continue to widen,” says Maaß.