Skip Ribbon Commands
Skip to main content

News Release


The European office market shows strength despite economic concerns 

Jones Lang LaSalle’s Q3 2011 European Office Clock Report reveals prime rent and demand fluctuations

London, 25th October 2011 - According to Jones Lang LaSalle, overall leasing volumes continued to improve over the third quarter of 2011 despite variations in prime offices rents.
Prime rents increased over the last quarter in Stockholm, The Hague (both +2.4%), Hamburg (+2.2%) and Milan (+1.9%), although these were offset by decreases in Brussels (-3.2%), Dublin (-3.0%), Madrid (-1.9%) and Edinburgh (-1.8%).
Despite these changes, the Jones Lang LaSalle European Office Index is unchanged. Office rents in CEE markets remained stable compared to the previous quarter, reflecting continued positive demand.

Despite ongoing concerns, the amount of European office space let increased in Q3 2011, with 2.9 million sq m of gross take-up, an increase of 6% compared to Q2 2011 and 16% higher than Q3 2010.

However, Bill Page, Head of UK and pan-EMEA Office Research, Jones Lang LaSalle said: “Demand is fluctuating across Europe. In the first three quarters of 2011, London office space take-up fell by 40% whilst Berlin, Munich and Stockholm grew strongly. In CEE the Q3 figures are 29% higher than the same period last year.”

“New office space completions throughout Europe also remain low. Across the first three quarters of 2011, 2.3 million sq m completed, about 45% below the ten year average.  Shortages of good quality space continue to be an issue in many markets.”

European Office Capital Values

Direct commercial European real-estate investment volumes continue to recover, with total year to date volumes 21% above the same 2010 period. Germany (+79%), Scandinavia (+60%) and France (+26%) performed well, along with Central and Eastern Europe, including Russia (+150%).

Chris Staveley, Head of EMEA Office and Industrial Capital Markets, Jones Lang LaSalle commented: “Overall trading levels remain influenced by limited supply of sought after prime core assets and the absence of any move into assets that are perceived to carry more risk. We are also feeling the lack of liquidity in the debt markets.”

Bill Page added: “Whilst office rents remain relatively unchanged, a slight outward movement on the yield side meant the European Office Capital Value Index showed the first negative movement since Q3 2009.”