market survey - german property partners · hamburg 2017/q1-3 take-up of space 2017/q1-3 | in m² |...

MARKET SURVEYCOMMERCIAL | OFFICE LETTING

2017/Q1-3

HAMBURG

Q3Grossmann & Berger’s promise: Market surveys.

www.grossmann-berger.com | page 2

440 525 540 550 465

Q3

165

2013 2014 2015 2016 2017

COMMERCIAL | OFFICE LETTING HAMBURG 2017/Q1-3

expected to last until 2021 and encompass an ensemble of build-ings offering 66,000 m² of floor space. Plans envisage apartments, commercial spaces and room for cultural uses as well as offices.

Five of the ten large agreements signed took place in the 1st quar-ter. These included the third-biggest contract of the year which was entered into by the University of Hamburg for 19,700 m² at Überseering 35, City North. Only one large contract was noted in the 2nd quarter, that for Olympus Deutschland. But in the 3rd quarter, three more contracts for over 5,000 m² of space were noted. For example, the health insurance firm Techniker Krank-enkasse signed an agreement for 8,200 m² of office space in the

“All the parameters indicate that business will continue its dynamic course.” Andreas Rehberg | Managing director

TAKE-UP OF SPACEConsiderably more take-up of large suites

Take-up of office space in the first three quarters was some 465,000 m² and thus 12% higher than in the same period a year before. The 3rd quarter, posting some 165,000 m² of newly let and owner-occupied space, was the best quarterly result thus far. The proportion of owner-occupied space, at 65,000 m², was a relative-ly low 14% of the total. One outstanding feature of the first three quarters was the large proportion of agreements for more than 5,000 m² of space. Overall this segment accounted for 29% of the total (137,000 m²). Agreements signed by Olympus Deutschland and Gruner + Jahr for 34,500 m² and 34,000 m² respectively played an essential part here. Olympus Deutschland is having a new, custom-made complex built in City South (Wendenstrasse 14-18); construction began in the 2nd quarter and completion is due in 2020. In the 3rd quarter it was announced that the pub-lishing house Gruner + Jahr had signed a rental agreement for a new headquarters in the “Am Lohsepark” district of HafenCity (Am Hannoverschen Bahnhof). Construction on building lots 73/74 is

Office stock

465,000 m²26.00 €/m²15.00 €/m²4.6 %13.59m m²

Take-up of space2013–2017/Q1-3 | in 000s m² | incl. owner-occupiers

10-year average (2007-2016):approx. 505,000 m²

KEY FACTS | OFFICE LETTING

Take-up of space Premium rent mth (net) Average rent mth (net) Vacancy rate

Source: Grossmann & Berger Research

| + 12 % year-on-year change

| + 4.0 % year-on-year change

| - 0.7 % year-on-year change

| - 0.4 pp year-on-year change

| + 1.2 % year-on-year change

pp = percentage point


COMMERCIAL | OFFICE LETTINGHAMBURG 2017/Q1-3

Take-up of space2017/Q1-3 | in m² | by size and no. of lettings

SELECTED TOP CONTRACTS2017/Q1-3

“Silberling” (Überseering 32-34, City North). WeWork, a provider of coworking space, rented some 6,400 m² of office space in the “Eu-ropa Passage” mall (Ballindamm 39-40, City) and logistics enter-prise Kühne & Nagel completed a contract for around 5,800 m² of office space in the “Shipyard” new-build development (Übersee-allee 12, HafenCity). With 510 rental agreements and owner-occu-pier contracts in the first three quarters, the number of contracts rose a little year on year. All size segments below 5,000 m² shared the market more or less evenly with about 18% each. The size cat-egory 2,001 to 5,000 m² was slightly lower with a share of 17%.

In the first three quarters of the year some 60% of the take-up of space was registered in the central sub-markets City, City South and HafenCity. City pulled ahead again in the third quarter, but only by a very narrow margin. Taking a 22% share of the total with 103,700 m², City was only slightly in front of City South with a share of 21% and a volume of 99,500 m². City’s good result was partly due to the business centres. These firms accounted for four new lets with a total volume of about 13,000 m² in the 3rd quar-ter alone. Since the beginning of the year business centres have rented about 26,000 m² of space in the City, which was equiva-lent to one quarter of the total take-up. HafenCity was the third busiest sub-market, its share of take-up totalled 15% and 68,800 m² of space. The biggest contributors to the good HafenCity result included the previously mentioned contracts signed by Gruner + Jahr (building lots 73/74, Am Hannoverschen Bahnhof) and Kühne & Nagel (“Shipyard”, Überseeallee 12). With a respectable fourth place and 9% of total take-up, City North remained a strong play-er. Apart from the contract with the University of Hamburg (Über-seering 35) three agreements - signed by Techniker health insur-ance, ERGO life insurance and beneFit fitness studio - for space in the “Silberling” (Überseering 32-34) made a significant contribu-tion of 14,000 m² to the total take-up of 41,900 m².

Most of the space taken up in the first three quarters of the year was attributable to four industries which accounted for about 60% of the total. The biggest share of some 16% (73,900 m²) was

Take-up of space2017/Q1-3 | by industry



Take-up of spaceNo. of lettings

18 %

83,000

18 %

85,000

18 %

82,000

17 %

78,000

29 %

137,000

up to

500

up to

1,000

up to

2,000

up to

5,000

over

5,000

1. Olympus | Wendenstraße 14-18 | ca. 34,500 m²

2. Gruner + Jahr | Am Hannoverschen Bahnhof | ca. 34,000 m²

3. Hamburg University | Überseering 35 | ca. 19,700 m²

4. Ministry of Schools | Amsinckstraße 28 | ca. 8,400 m²

5. Techniker Krankenkasse | Überseering 32-34 | ca. 8,200 m²

6. WeWork | Axel-Springer-Platz 3 | ca. 7,800 m²

7. Ministry of Schools | Amsinckstraße 34 | ca. 6,400 m²

8. WeWork | Ballindamm/Hermannstraße | ca. 6,400 m²

9. Kühne & Nagel | Überseeallee 12 | ca. 5,800 m²

10. Publicis Pixelpark | Heidi-Kabel-Platz 2 | ca. 5,700 m²WeWork | “Europa Passage”, Ballindamm/Hermannstr. | City | ca. 6,400 m²

61 27 10291 121

16%

14%

14%

13%

8%

35%Other

IT & telecommunications

Construction & property

Public administration

Services to business

Manufacturing industry



Vacant space | Vacancy rate2013–2017/Q3 | in 000s m²

Premium and average rent2013–2017/Q3 | in €/m²/mth (net)

taken by the information and telecommunications industry, par-ty due to the rental agreement signed by Gruner + Jahr for space in HafenCity. Placed second and third, with shares of 14% each (67,000 m²) were consultancies and companies engaged in man-ufacturing. Whereas the manufacturing sector posted no new lets over 1,000 m² in the 3rd quarter, consultancies accounted for six new leases for more than 1,000 m² of space in the third quarter, e.g. the consultancy Ecker + Ecker GmbH, which will be moving into some 1,300 m² of space at Warburgstrasse 50 (Alster West). Construction and real estate came fourth in the ranking by indus-try. With the exception of the agreement signed by Goldbeck Nord for around 3,600 m² (Fuhlsbüttler Strasse 29a) take-up by the construction and real estate sector was dominated by business centres. In the 3rd quarter four new lets for over 1,000 m² were signed, two of them by WeWork, which took space in the “Europa Passage” mall and in the “Richard Böse Haus” (Gänsemarkt 43). The other providers were rent24 (“Kaufmannshaus”, Bleichen-brücke 10, City) and Design Offices (Görttwiete 16-20, City).

By the end of the 3rd quarter both the premium rent and the av-erage rent had risen slightly above their levels a year before. For example the premium rent rose over the course of 12 months from €25.00/m²/month to €26.00/m²/month (+4%) while the average rent grew from €14.90/m²/month to €15.00/m²/month (+0.7%). Because so little vacant space is available, companies are rac-ing each other to secure the best offices. Already, one often finds several companies in talks about renting one and the same space. Consequently, rents will grow appreciably in the medium term. The market now favours landlords over tenants.

The shortage of office space in Hamburg has become more acute since the last quarter. Whereas at the end of the 2nd quarter the vacancy rate, including sublet space, was still 4.9%, by the end of the 3rd it had fallen to 4.6%. The amount of space available to new tenants within a period of three months had fallen to a mere 620,000 m². The shortage of space is changing the market param-eters. Even just a few months ago customers could reserve space for a fairly long period in order to gain more time to make their de-cision but now, whatever they do, they must be quick about it. The volume of completions stands at a record 272,000 m² in 37 devel-opments. But the massive 69% of pre-let space means that only the small amount of 85,000 m² will land on the open market. Of the 151,000 m² of office space that is scheduled for completion in 2018, only 79,000 m² will be put on the market. The pre-let rate here is 48 %. Most of this development activity is taking place in the City sub-market where 23 developments will provide 117,000 m² in 2017/2018.

Completions | Pre-let rate2014–2018 | in 000s m²

Premium rent

Average rent




RENTSFrom tenant’s to landlord’s market

AVAILABLE AND VACANT SPACEShortage of space is changing market

24.0024.50

25.00

26.00 26.00

14.0014.50 14.50

15.5015.00

2013 2014 2015 2016 2017/Q3

932 798 698 684 619

7.0%

6.0%

5.2% 5.1%

4.6%

2013 2014 2015 2016 2017/Q3

116 120 192 272 151

69 %48 %

2014 2015 2016 2017 2018



Sub-market

Take-up of space in m² incl.

owner-occupiersVacant space

in m²Vacancy rate

in %

Rents paid longer-term in €/m²/mth

(net)

Average rent in €/m²/mth

(net)

Completions 2017/2018

in m²

1 CITY 103,700 115,900 3.9 12.00 – 26.50 19.60 117,200

2 HAFENCITY 68,800 24,600 4.8 12.50 – 24.50 19.50 38,000

3 PORT RIM 7,900 12,600 5.9 12.50 – 22.00 17.50 600

4 ALSTER WEST 8,800 5,700 1.0 13.50 – 24.00 19.10 0

5 ALSTER EAST 5,600 23,800 7.5 10.50 – 25.00 18.60 21,600

6 ST. GEORG 9,300 1,800 0.4 12.00 – 19.00 17.30 10,900

7 CITY SOUTH 99,500 126,100 8.1 6.00 – 16.00 10.80 36,200

8 ST. PAULI 2,800 14,600 3.3 9.00 – 21.50 16.40 7,100

9 ALTONA 14,900 11,400 1.6 8.50 – 16.50 13.70 41,000

10 BAHRENFELD 12,100 58,100 13.3 7.50 – 14.00 11.50 9,800

11 EIMSBÜTTEL 8,800 10,500 4.9 10.50 – 15.50 11.50 16,400

12 EPPENDORF 7,000 18,700 5.9 8.50 – 13.50 12.00 0

13 AIRPORT 4,700 32,500 3.8 8.50 – 14.00 12.90 40,900

14 CITY NORTH 41,900 26,600 4.6 7.00 – 14.50 9.40 33,100

15 BARMBEK 14,000 28,000 4.7 7.00 – 14.50 11.60 14,600

16 WANDSBEK 6,500 35,900 6.1 6.50 – 15.00 10.00 0

17 HARBURG 15,300 23,400 2.5 7.00 – 13.00 10.00 7,200

18 HAMBURG EAST 11,400 33,200 7.7 6.00 – 14.00 9.60 24,800

19 HAMBURG WEST 22,000 15,800 1.7 6.00 – 12.00 9.10 4,000

TOTAL 465,000 619,200 4.6 6.00 – 26.50 15.00 423,000

OVERVIEW OF OFFICE SUB-MARKETS HAMBURG2017/Q1-3


Take-up of space. In view of the economic environment the prospects for Hamburg’s office market are favourable. All the parameters indicate that business will remain as dynamic in the fourth quarter too. A year-end take-up figure of 600,000 m² looks probable. The low vacancy level is the only factor that might slow the market.

Rents. In the short to medium term the growing shortage of available properties will result in higher rents. In central sub-markets the average rent is set to rise noticeably.

Available space. It is not to be expected that more property will be available to let in the short to medium term. The projected amount of speculative building activity in 2017/2018 will not satisfy current demand for office space. Clients in search of offices must be prepared for fur-ther shortages in supply.

Hamburg’s employment figures continue to be good. In Septem-ber 2017 the unemployment rate sank to 6.7%. This indicates how well business is thriving in Hamburg and points to a healthy office-letting market.

The economic situation is good throughout the Federal Repub-lic of Germany. Despite a few risks, the World Economy Institute (HWWI) sees an upturn in the German economy and has adjusted its forecast in the light of a first half year that exceeded expecta-tions. For the year 2017 the Institute now expects to see economic growth of 1.8% whereas the forecast in the quarter before was 1.3%. The growth is chiefly driven by private and public consumer spending. However, the HWWI reports that during the year so far there has been appreciable growth in corporate capital spending on plant and buildings. The forecast growth for 2018 remains un-changed at 1.6%.

The survey conducted in September 2017 by the ifo Institute to gauge business confidence paints a similarly positive picture. Germany’s service providers are taking an optimistic view of the immediate future and planning to hire new personnel. Their in-dex of business confidence thus rose slightly in September, from 110.6 to 110.7 points. By contrast the ifo index reflecting confi-dence throughout German trade and industry fell slightly, from 115.9 to 115.2. Nevertheless the result continues to be apprecia-bly above the long-term average (starting 1991) of 102.1.

OUTLOOKTake-up above prior year’s figure of 550,000 m²


G&B’s promise: Michel und Hafen im Blick.“Michaelis Quartier” | Ludwig-Erhard-Straße 11-17 | City | ca. 17,605 m² | available from 2020


COMMERCIAL | OFFICE LETTING HAMBURG 2017/Q1-3

Take-up of space: Take-up of space is the total of all space newly let plus that sold to

or built by an owner-occupier during the period under review. The operative date for

inclusion in the statistics is the date on which the lease or purchase agreement was

signed. Lease renewals are not counted as take-up. Areas are stated on the basis of

the guide for calculating the rental area in commercial leases (MF/G).

Premium rent: The premium rent is that paid for the most expensive 3% of the mar-

ket for new lets (not counting owner-occupiers) during the 12 months just ended and

is stated as the average of such rents.

Average rent: The average rent paid is calculated by taking the individual rents

agreed in all leases signed over the past 12 months, weighting them by the amount

of space rented and computing the mean value. Figures refer to nominal net rents

ex services.

Vacancies: Vacancies include all office space that is available to new tenants within

three months. Sub-let space is counted as vacancy.

GLOSSARYDefinitions, office market

SKILLED CONSULTANCYServices and contacts

Photo credits: Cover: Ludwig-Erhard-Straße 24 © Fotolia, page 2: “FrachtRaum”, Neuer Wall 34 © Chantal We-ber, page 3: “Europa Passage”, Ballindamm/Hermannstraße © Carsten Leuzinger, page 6: “Michaelis Quartier”, Ludwig-Erhard-Straße 11-17

We draw your attention to the fact that all statements made here are non-binding. Most ofthe information is based on third-party reports. The sole intention of this market survey is toprovide general infomation for our clients.

Grossmann & Berger GmbH • Bleichenbrücke 9 (Bleichenhof) • D - 20354 Hamburg Tel.: +49 (0)40 / 350 80 2 - 0 • Fax: +49 (0)40 / 350 80 2 - 36 [email protected] • www.grossmann-berger.de

Managing directors: Andreas Rehberg, Holger Michaelis, Lars Seidel, Axel Steinbrinker Chairman of the supervisory board: Frank Brockmann Registered office Hamburg • Registered at Hamburg no. B 25866

Sonja Ebert | MBA Real Estate Management | ResearchPhone: +49 (0)40 / 350 80 2 - 641Mail: [email protected]

Anna Martens | Diplom-Ingenieur Master of Urban Planning | ResearchPhone: +49 (0)40 / 350 80 2 - 615Mail: [email protected]

Tatjana Merger | Master of Science Urban Planning | ResearchPhone: +49 (0)40 / 350 80 2 - 231Mail: [email protected]

What can we do for you?An analysis of the property markets is an important part of the wide-ranging consultancy services offered by Grossmann & Berger. We would be pleased to be of assistance in your deci-sion-making process and can draft an offer that is tailored to your specific requirements.

From left to right: Sonja Ebert | Anna Martens | Tatjana Merger

market survey - german property partners · hamburg 2017/q1-3 take-up of space 2017/q1-3 | in m² |...

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