www.108realestate.ro logo

News

European Office Markets in the First Half of 2026: Lower Demand, but Rising Prime Rents and Deepening Polarization
Offices

European Office Markets in the First Half of 2026: Lower Demand, but Rising Prime Rents and Deepening Polarization

Demand for office space in major European cities fell by 9% year-over-year in the first half of 2026, mainly due to a lack of large transactions. Prime rents, however, continue to rise—by 6.2% year-over-year in major markets—driven by a shortage of high-quality Class A space. The vacancy rate rose to 9.6%, but remains highly polarized: prime locations in city centers are nearly full, while space is becoming available on the outskirts.

More
Trend in Office Leasing in Europe: Companies Are Seeking Smaller Spaces but Are Willing to Pay Higher Rent for Them
Offices

Trend in Office Leasing in Europe: Companies Are Seeking Smaller Spaces but Are Willing to Pay Higher Rent for Them

Hybrid work arrangements and remote work are among the main reasons for the weaker performance of the office space market in Europe during the first half of this year. However, the declining volume of lease transactions is also influenced by tenants’ cautious approach due to economic uncertainty. Another factor is the shortage of larger, high-quality spaces available for rent, especially in attractive parts of European cities. While demand for prime office space is growing in Barcelona, Brussels, and Dublin, traditional markets in London, Paris, Milan, and Germany’s largest cities are seeing a double-digit year-over-year decline in leasing activity. According to the real estate consulting firm 108 REAL ESTATE, tenants’ needs are clearly changing—there is a prevailing interest in smaller, higher-quality spaces in attractive locations, for which companies are willing to pay higher rents. The highest rents have risen by nearly 5% year-over-year.

More
Submit inquiry