Greif & Contzen’s latest analysis depicts a market in which large-scale lettings are a rare occurrence

Cologne’s office space market continues to be affected by a weak economic situation and political uncertainties. Companies have been postponing their plans to rent new space, while they are waiting for the government to create the necessary political framework. By the end of September, the total office space turnover was around 160,000 square metres. This figure represents a slight increase of approximately 3.0 per cent compared to the same period last year. Few large units were taken up, with tenants focusing on small to medium-sized premises. The vacancy rate rose to about 5.5 percent over the course of the year. Compared to Germany’s other top seven cities, it is, however, still on a relatively low level. At the same time, the negotiation position of prospective tenants of office space has gotten better, even in popular locations, thanks to greater availability of existing space.

Letting structure, rents and pricing level
A small number of large units taken up in new builds caused the weighted average rent to increase to EUR 21.70, while the prime rent dropped to around EUR 34.00, down from EUR 35.00 at the start of the year. The unweighted average rent increased to around EUR 17.90 per square metre. The overall level of rent prices increased compared to 2024, despite the fact that the highest rents have so far been lower than those obtained in previous years.

Development of demand and letting dynamic
Demanders are currently focussing on smaller to medium-sized units. “In the current market environment, prospective tenants benefit from greater availability and therefore greater choice,” says Andreas Reul, Head of Office Properties at Greif & Contzen Immobilienmakler GmbH. “Large transactions were, however, the exception rather than the rule, and demand did not pick up considerably following the summer months. There are some companies that want to take up large units, but it remains unclear, when these will actually conclude contracts. Enterprises tend to hold back and postpone decision making, due to the weak economic situation,” Mr Reul explains.

Political and economic stimuli will be key in 2026
The real estate experts from Greif & Contzen expect that a total of around 210,000 square metres will be taken up this year, matching last year’s result. “This is neither a particularly good nor a particularly poor figure,” Andreas Reul states. “The market has been holding its ground in a difficult environment, without becoming too volatile.” Greif & Contzen’s property experts believe that there is cause for hoping that demand for space will increase in 2026. This assumption is also backed by the latest forecasts by institutes for economic research: these expect gross domestic product to rise by between 0.0 and +0.25 percent in 2025, and have been forecasting greater growth of between +0.8 and +1.7 percent for 2026. Real estate expert Andreas Reul explains: “No considerable increase in demand is to be expected in the last quarter. However, the market is in a robust position, despite current weaknesses. Further development in the year ahead will depend greatly on whether economic policy impulses will in fact be implemented. On the whole there is cause for cautious optimism in Cologne’s office space market.”