Development in the Ruhr Metropolis
16.78 m m²
Volume of office space
Volume of new construction
Top rent level
The volume of office space in the Ruhr Metropolis at the end of 2017 totalled approximately 16.78 m m² commercial rental space (CRS). With this, it remains the second-largest office market in Germany, after Berlin.
The volume of new construction stood at 220,000 m² CRS, significantly above the 5-/10-year mean of 150,000, respectively 147,000 m² CRS. The amount of new space therefore exceeded all A cities, which recorded a mean volume of approx. 94,000 m² CRS.
The highest volumes were recorded in Essen, with around 73,000 m² CRS, and Bochum, with around 70,000 m² CRS.
In 2018, according to the specific project pipeline for the Ruhr Metropolis a completion volume of just over 200,000 m² CRS is anticipated.
The level of vacancy for office space in the Ruhr Metropolis fell compared to the previous year by approximately 115,000 m² CRS to 673,000 m² CRS at the end of 2017. With a vacancy rate of 4.0 %, the region is now just behind the A locations Munich (2.7%), Stuttgart (2.9 %) and Berlin (3.0 %). A further moderate decline in vacancy levels is expected for 2018.
Vacancy is typically concentrated on older properties with average equipment levels and correspondingly limited marketability.
There is an ongoing shortage of supply for large, contiguous office space with modern equipment levels.
"Investment boom in the Ruhr Metropolis leads to fall in returns."
Office space turnover in the Ruhr Metropolis stood at around 470,000 m² CRS in 2017, approaching the level of the 5-/10-year mean. This means that the Ruhr Metropolis comfortably exceeds the turnover recorded for Düsseldorf (325,000 m² CRS), Cologne (307,000 m² CRS) and Stuttgart (264,000 m² CRS).
A decisive factor in the fall in turnover was the lack of large-volume owner-occupancy construction projects commencing, which had led to a peak in turnover in the previous year. Floor space turnover in the region of the long-term average is anticipated for 2018. A slight rise in office employment figures is anticipated in the Ruhr Metropolis in the short to medium term, indicating avid demand for office space in the future.
Demand for office real estate in the Ruhr Metropolis resulted in the net initial returns (prime yields) for properties in central locations falling by 50 basis points to 4.5 % at the end of 2017, which also represented a new historical low. With this, the Ruhr region lies 120 basis points above the mean for A locations, where the yields sank again slightly in the course of 2017.
The prime yields in the Ruhr Metropolis are achieved in Essen, followed by Dortmund with 4.6 % and Bochum with 5.1 %. A sideways movement regarding the development of prime yields is anticipated for 2018. The mean net initial returns for decentral locations in the Ruhr region stood at 7.9 % at the end of 2017, 20 basis points below the level of the previous year.
The top rent level in the Ruhr Metropolis saw a slight rise compared to the previous year, increasing by 3.5 % to 15.00 euro/m² CRS. This is achieved in the central locations as well as in the Südviertel district of Essen, followed by Dortmund and Duisburg with 13.70 euro/m² for the most desirable locations.
The remaining location categories display largely stable trends. A moderate rent increase to a peak of 15.10 euro/m² CRS is anticipated for 2018. The average rents in the Ruhr Metropolis have been stable. The mean average rent for city-centre locations of all sub-markets in the Ruhr region stood at 7.72 euro/m² within the year, marginally above the previous year.