With a take-up of 485,000 m², the Bavarian capital recorded a strong first three quarters despite the challenging economic climate and ongoing geopolitical uncertainties. This is according to an analysis by BNP Paribas Real Estate.
Although the momentum in Q3 slowed slightly to around 131,000 m² compared with the first two quarters (Q1: 172,000 m²; Q2: 182,000 m²), the overall figure still shows a 19 per cent increase compared with the same period last year. “Munich is thus one of the few German office locations with rising take-up and has maintained its position in the national rankings in the third quarter as well, just behind Berlin with 541,000 m² and still well ahead of Frankfurt with 300,000 m²,” said Michael Morgan, Head of the Munich office of BNP Paribas Real Estate GmbH.
Vigorous demand can be observed across almost all size categories. Particularly noteworthy is the above-average volume of medium-sized transactions between 2,000 and 5,000 m², which account for almost 22 per cent, or around 106,000 m², of total turnover. In addition, large transactions exceeding 10,000 m², with a market share of just under 18 per cent, are also making a significant contribution to the strong performance. However, no transactions of this magnitude were recorded in the third quarter. The largest lettings to date therefore remain the E.ON deal, facilitated by BNPP RE, covering 21,500 m², followed by the letting to JetBrains of 21,000 m² in Tucherpark.
The positive market trend and the high demand for high-quality space in attractive locations are particularly evident in the prime segment. As a result, prime rents have risen by 9 per cent over the last twelve months to 60 €/m². The average rent remains stable at 26.90 €/m².
Industrial sector remains the industry leader, whilst vacancy rates remain stable
Munich’s industrial companies are proving particularly active in the rental market in 2026. With a take-up of around 159,000 m², they have achieved an above-average market share of just under 33 per cent. In addition to the aforementioned E.ON deal, this strong result is primarily based on a large number of medium-sized lease agreements. This also reflects the increased demand from the defence industry. Information and communication technologies are also making a significant contribution, accounting for almost one in every four square metres of take-up and, in absolute terms, achieving their third-best result of the past ten years.
At the end of September 2026, the volume of vacant space stood at around 1.88 million m². Compared with the previous quarter, this represents an increase of just over 1 per cent. The vacancy rate currently stands at 8.1 per cent. Since the second quarter of 2025, the overall trend has been largely sideways. During this period, the volume of vacant space fluctuated only between 1.82 and 1.88 million m². The supply of modern office space has also remained broadly stable in recent months, standing at around 847,000 m² most recently. Modern space in central Munich locations remains in limited supply, particularly those of ‘first-occupancy’ quality. In the City submarket, only around 18,000 m² is available in the short term. In the wider city fringe within the Mittlerer Ring, the available supply in this segment amounts to around 24,000 m².
Outlook
Despite the challenging economic and geopolitical conditions, the Munich office market achieved strong results in the first three quarters of 2026. The rise in take-up has helped Munich to stand out from the other major German office markets, second only to Berlin in a nationwide comparison.
Geopolitical tensions in the Middle East continue to have a noticeable impact on the global economy and are weighing on economic growth in particular. Nevertheless, several factors suggest that the positive trend in demand seen in the first three quarters will continue into the year-end period. In particular, the investment programme for defence and infrastructure is also likely to provide a further boost to demand for office space. Corresponding transactions have already been recorded since the start of the year. Furthermore, there are several large-scale space enquiries currently on the market. Should these be successfully concluded, this could provide further impetus. Against this backdrop, a take-up of around 620,000 m² by the end of the year appears realistic.
“On the supply side, vacancy rates are currently showing signs of stabilising. For high-quality premium space, however, the available supply is likely to become even scarcer. At the same time, upward pressure on prime rents remains, meaning that even after the €60/m² mark has been reached for the first time, further increases are likely only a matter of time,” predicts Michael Morgan.
