The delayed reaction of office markets to macroeconomic developments has been evident since the final quarter of 2022, when the chain of effects of the conflict in Ukraine reached the rental markets. Since then, restraint has been exercised, particularly by those seeking space, a situation that has not changed in the first three months of 2023. Companies and therefore the office markets are still a long way from a high level of decision-making. As expected, more leases of office space are being extended, some for only a few years, with many companies shying away from long-term location decisions.

After a lengthy planning phase, tenants and owner-occupiers have been identifying the working model that works best for them, which in most cases includes regular home office work, and ultimately a slightly lower office space requirement. Space which is subsequently deemed surplus to requirement is often offered for subletting. In some cases, this can involve units larger than 10,000 sq m. Medium-sized and large companies are in a position to substantially reduce their office space requirements. However, in the case of smaller companies, the often poor flexibility of the rental space does not provide any scope for downsizing. Increasingly, the proximity to flexible office space providers, either in-house or in the immediate vicinity, is becoming relevant for tenants seeking space. This provides them with a certain degree of flexibility.