Savills IM sees potential for rent increases in Berlin and Munich
In its recent office market report, Savills IM has found that the German office real estate market will remain attractive for investors in the future despite “challenging” high purchase prices. With prices currently between €6,800/sqm and €14,300/sqm, the net present values for core office properties in Germany’s Big 7 cities are still attractive compared to other European office markets such as London, Paris, Stockholm and Madrid, where prices are as high as €36,000/sqm. Savills IM anticipates further increases in prime and average rents, with no end to this development in sight. The investment management firm also sees potential for rent increases for existing stock as many office spaces, particularly in Berlin and Munich, are being let below current market level.
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