Second largest office market in Germany
17,4 Mio. qm MFG
Office space stock 1/2021
264.000 qm MFG
New construction volume
16,50-17,00 Euro/qm MFG
Achievable peak rent
According to the provisional figures, around 264,000 sq m of office space will be completed in the Metropole Ruhr in 2021, which is around 84% above the average of the last 10 years (144,000 sq m) and also the third highest figure since 2000. In comparison with the seven A-cities, the Metropole Ruhr is only beaten by Berlin, where a record-breaking volume of around 740,000 sq m will be completed.
The new building volume is carried by the two most important submarkets Essen and Dortmund, which contribute 65,000 m² and 43,500 m² respectively to the result. Also worth mentioning is the city of Moers, whose production of new building space will amount to approx. 40,000 m² MFG with a number of projects (including own use by Edeka). This is followed by Bochum with 18,500 m², Gelsenkirchen with 13,000 m² and Recklinghausen with 12,800 m².
The volume of new construction will thus develop much more dynamically than was assumed at the end of 2020. At that time, the completion volume for 2021 was estimated at around 170,000 m². There have been no construction stoppages or significant project delays to date, meaning that a significantly above-average result can be expected by the end of the year.
The Metropole Ruhr will defend its position as Germany's second-largest office market behind Berlin (20.3 million m² ) with a stock of space of around 17.4 million m².
Based on the concrete pipeline, the volume of new construction in 2022 will total around 200,000 m². Shifts in projects with location disadvantages or insufficient pre-letting cannot be ruled out due to the changed financing conditions as a result of the pandemic.
After the vacancy rate in the Metropole Ruhr increased by around 85,000 sq m to 690,000 sq m or 4.0% in the wake of the Corona pandemic, a further increase of around 46,000 sq m to 736,000 sq m was recorded by the end of the first half of 2021. The vacancy rate for the Metropole Ruhr rose slightly to 4.2 % and remains within the range of a healthy supply reserve. The decisive factor for the further easing on the supply side was primarily the significant increase in the supply of space available for short-term occupation in Essen. Here, there is approx. 30,000 m² more office space vacant compared to the end of 2020. In Duisburg, too, a further increase in the supply reserve was noted in the first half of the year, albeit with a marked slowdown in momentum. Currently the level amounts to 73,000 m² or 3.2% (2020: 64,000 m² or 2.9%).
In Dortmund, last year's increase in vacancies appears to be short-lived. By the end of the first half of the year, 10,000 m² of available space had already been reduced, so that the Dortmund office market, with a space supply of 80,000 m² or 2.9 % of the stock, is approaching the pre-crisis level again. In Bochum the vacancy rate dropped to 45,000 m² or 2.7 %.
An optimistic view is permitted for the second half of the year due to catch-up effects in the course of the overall economic recovery and a rising vaccination rate. It can be assumed that the supply of space will stabilize at the current level rather than increase with comparable dynamics as in the last 12 months. In this context, the far-reaching restrictions of the first half of the year must also be mentioned, which stood in the way of a rapid recovery in demand for space and a better turnover result.
In the first half of 2021, approx. 258,000 sq m of office space was taken up in the Metropole Ruhr, which is slightly more than half of the previous year's figure. The noticeable revival has thus failed to materialise in the Metropole Ruhr to date. Against the backdrop of the long lockdown, private-sector companies are still acting very cautiously or are postponing leasing decisions to a later date.
The largest leases concluded in the past half-year included, for example, the owner-occupier development of approx. 15,600 m² by Amprion and the pre-letting of 5,800 m² to Bechtle (both Dortmund Phoenix West) and the project letting of 6,000 m² by the Dortmund police headquarters at the airport. The market was also characterised by the letting of the new building project Moritz with 8,300 m² by Vonovia in Essen's Weststadt, the owner-occupier starts of Escrypt with 7,500 m² and Zetcon Ingenieure with approx. 6,000 m² in Bochum's innovation quarter Mark 51°7 as well as the letting of 6,000 m² to the job centre in the former Vonovia headquarters in Bochum.
With 74,000 m² of office space transacted, Dortmund took the lead among the submarkets in the Metropole Ruhr and was already able to exceed the overall result from the previous year by around 6,000 m². Essen follows in second place despite a moderate half-year result of 40,000 m², followed by Duisburg with 37,000 m².
Last year the smaller towns and districts in particular contributed to the stability of the office market in the Metropole Ruhr with above-average take-up, so that with a total of just under 500,000 m² a respectable result was achieved. However, there are no signs of this happening in 2021. Nevertheless, deferred lettings may provide a further boost to demand in the second half of the year, making take-up in the region of the 10-year average of 475,000 sq m appear realistic.
Development of rents
The achievable top rent in the Metropole Ruhr is now in a range of 16.50 to 17.00 euros/m², which is quoted for high-quality letting space in very good locations in the submarkets of Essen, Dortmund, Bochum and Duisburg. In some cases, rents above the 17.00 euro/m² mark have already been achieved in the top markets of the Metropole Ruhr.
Against the background of the continuing very limited supply of modern space in the top locations, the increasing demands of tenants in terms of quality of fit-out and rising building and land costs, a positive trend in terms of top rents is to be expected in the short to medium term. In the smaller submarkets of the Metropole Ruhr, such as Bottrop, Gelsenkirchen, Herne and Mülheim an der Ruhr, the achievable prime rent remains unchanged at 13.00 euros/m². The average rent for all submarkets in the Metropole Ruhr stabilised at 8.40 euros/m² in the first half of 2021. In the four largest locations of Duisburg, Bochum, Essen and Dortmund, a moderate increase of 0.10 euros/euro/m² to 11.00 euros/m² was recorded. In the B and C cities of the Metropole Ruhr, the average rent within the first half of the year was 7.40 euros/m², also just under 0.10 euros/m² above the previous year's level.
Overall, average rents are very robust and are not coming under pressure despite an increase in supply. This increasingly reflects the higher quality of the space let.