Office Space Market Report 2018/2019 · HAMBURG

585,000 sqm 3.5% 13.9 Mio. sqm 27.50 EUR/sqm 15.70 EUR/sqm Take-up Vacancy rate Office stock Prime rent Average rent

The Hamburg market for o ce space recorded increasing because the rent spreads in all sub-markets great results in 2018 with a total take-up of around have shifted upwards. 585,000 sqm. While this exceeded the fi ve-year average by 7.2%, it was not possible to achieve a repeat of the Still scope for major transactions record fi gures in 2017, which is partly down to shifts in market behaviour. While it was largely possible to In the past year, 16 major deals of over 5,000 sqm rental meet demand in recent years, take-up is now largely space were concluded, with fi ve contracts for more than determined by low supply. 10,000 sqm. The biggest deal was achieved by Beiersdorf with the construction of its 45,000 sqm corporate Peak rent increases to EUR 27.50/sqm headquarters on Troplowitzstrasse. This project made the Eimsbüttel/Eppendorf submarket one of the most The strained supply situation on the Hamburg o ce space active letting markets, with a 10.5% share of the total market is clearly refl ected in the city’s rent increases, market volume behind the City (22.5%), City-South with prime rent increasing from EUR 26.00/sqm to (15.6%) and the east of the city (11.0%). The second- EUR 27.50/sqm in 2018. Currently at EUR 15.70/sqm largest transaction was the leasing of around 13,800 sqm (2017: EUR 15.20/sqm), the average rent is also in the Ipanema new construction project by Postbank.

Take-up Take-up - location*

700 23%

640 City City-South 16% 600 585 550 545 11% 535 Hamburg East 530 500 Eimsbüttel/Eppendorf 11% 7% 400 Altona/St. Pauli 7% City-North 6% 300 5% Hamburg West 4% 200 Alster East 4% in thousand sqm Airport 3% 100 Harbour's Edge 3% Others 3% 0 2014 2015 2016 2017 2018 2019* 0% 10% 20% 30% 40% * Forecast * Year 2018

Source: Engel & Völkers Commercial Source: Engel & Völkers Commercial

Office Space Market Report 2018/2019 • Hamburg Significant take-ups 2018 (selection)

User Space Oce area

Beiersdorf Headquarters 45,000 sqm Eimsbüttel/Eppendorf

Deutsche Postbank 13,800 sqm City-North

Akquinet 12,000 sqm Hamburg East

BDK 10,500 sqm Hamburg East

Signal Iduna 10,000 sqm City-North

Source: Engel & Völkers Commercial

Otto Wulœ and Hamburg team are planning to complete letting in the new building project Bramfelder Spitze the mixed-use quarter on the former site of the Post of the project developer Evoreal. From mid-2022, the Pyramid by 2023. Thanks to further major leases from IT consulting firm Akquinet will move into around companies in the financial sector, such as Signal Iduna 12,000 sqm in the mixed quarter on Bramfelder Chaussee. (10,000 sqm) or the Hanseatic Bank (7,700 sqm), the sector grew significantly compared with 2017 and now Office space shortage increasing accounts for 14.6% of the volume (2017: 5.6%). Only the industrial administration sector has a higher take-up Vacancies have decreased continuously from around (17.5%). The third largest transaction in 2018 was a 1.3 million sqm in 2010 to around 490,000 sqm

Take-up - segment* Take-up - size categories*

Industrial administration (18%) ≤ 500 sqm 13% Financial sector (15%) Information and communication services (13%) 501–1,000 sqm 19% Building industry, rental, lease and sale (11%) Information and communication 1,001–2,000 sqm 22% services (11%) Public authorities and administration (9%) Transport, tra‰c, post and 2,001–5,000 sqm 18% courier services (9%) Media and advertising (5%) > 5,000 sqm 28% Commerce (5%) Other (3%) 0% 6% 12% 18% 24% 30% Associations and special interest groups (2%) * Year 2018 Health and social care (2%) * Year 2018

Source: Engel & Völkers Commercial Source: Engel & Völkers Commercial Constructions - Completion 2019 (selection)

Project Project developer Space Oce area

Euler Hermes Headquarters Quantum Immobilien AG 20,000 sqm Hamburg West

Jungheinrich Headquarters Extension Jungheinrich AG 15,500 sqm Hamburg East

Oce Lofts GbR Lerchenstrasse/Lippmannstrasse 11,500 sqm Altona/St. Pauli

Haus am Domplatz - HAD Quarter Allianz Real Estate GmbH 7,700 sqm City

Brückenquartier - Building 2 Warburg-HIH Invest Real Estate GmbH 6,300 sqm Harburg

Source: Engel & Völkers Commercial

today. The vacancy rate of 3.5% is once again signifi- activity is the rise in construction costs. For example, the cantly lower than in the previous year (2017: 4.3%). requirements for energy eciency, user requirements This is partly due to the fact that the oce space stock with regard to equipment and the high capacity utilisation hardly changed during 2018 and still stands at around of construction companies are cost-driving factors. Last 13.9 million sqm. Oce projects due for completion are but not least, the preference for other types of use, such not able to cover demand as a result of high pre-leasing as residential or hotel use, leads to a limited availability rates. The speculative construction of oce blocks will of space for oce development. not provide any relief for the market in the medium term. One of the reasons for the low level of construction

Office rents Vacancy

30 27.50 1,500 7.2 8 25.50 26.00 24.00 24.50 25.00 6.5 25 1,200 5.5 6 20 5.0 15.20 15.70 900 4.3 13.90 14.30 14.40 14.80 15 3.5 4

600 Rate in % 10 in thousand sqm 980

900 2 760

300 700 5 600 490 in EUR/sqm add. costs excl. 0 0 0 2013 2014 2015 2016 2017 2018 2013 2014 2015 2016 2017 2018 Prime rent Average rent Vacancy Vacancy rate

Source: Engel & Völkers Commercial Source: Engel & Völkers Commercial

Office Space Market Report 2018/2019 • Hamburg Office space completion

300 275 252

225 Wellingsbüttel 192 138 170 145 150 139 129 116

113 Fuhlsbüttel 104 Niendorf

in thousand sqm 75 106** Ohlsdorf

0 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019* * Forecast ** of which, pre-let Groß Borstel Source: bulwiengesa, Engel & Völkers Commercial

A7 Eppendorf Barmbek-North Stellingen Coworking providers compete for space Office space market to remain -East under pressure in 2019 HAMBURG WEST Hoheluft-West Barmbek-South The limited space available forces interested parties to HAMBURG EAST start looking for rental space at an early stage, often two In the past, prime rents peaked at regular intervals of about Eimsbüttel to three years before the planned moving in. In addition, eight years. In 1992 a maximum of approx. 28.00 EUR/sqm Marienthal companies now tend to have to accept longer contract could be observed, after a temporary drop the next terms in order to stand out from other potential tenants. maximum of approx. 25.00 EUR/sqm followed in 2000 Groß Flottbek Altona-North Hohenfelde Because it is dicult to estimate future space requirements and in 2008 a further temporary maximum of almost Schanzenviertel Hamm-North over such a long period of time, however, more flexible 24.00 EUR/sqm followed. As the peak rent of 2018 has St. Georg Horn rental options are increasingly being considered, such as not decreased for the eighth year in a row and continues St. Pauli Hamm-Central Neustadt Altstadt business centres, co-working spaces or hybrid models. to approach the record levels of 1992, the question is Altona-Altstadt Hamm-South Providers of these services are themselves becoming whether the end of the current cycle is in sight. However, Klostertor competitors for oce space because they are able to it does not appear that this point has been passed yet. The HafenCity accept long contractual periods and are ready to pay demand for oce space will continue to increase in 2019, comparatively high rents. As a result, rents are rising as will the rent level as a result of the continuing shortfall in prime locations, such as the inner city, where most in supply. Engel & Völkers Commercial therefore once A7 flexible oce spaces are located. The big co-working again expects to see dynamic market activity during the service providers once again expanded their share in current year with a take-up of around 550,000 sqm. 2018. Design Oces will occupy around 8,600 sqm in the future Olympus Campus. The US company WeWork has rented 5,100 sqm in Gerhofstrasse for its fourth location in Hamburg's city centre.

Following record oce space take-up in 2017, the result for 2018 decreased by 8.6 % on the previous year to 585,000 sqm. Nevertheless, it was still a highly satisfactory year. The decrease was not due to demand from companies but rather a lack of larger, coherent spaces in the best locations. A total of 16 transactions in the 5,000+ sqm category were registered, 5 of which were over 10,000 sqm.

Oliver Horstmann, Engel & Völkers Commercial Hamburg

Office Space Market Report 2018/2019 • Hamburg Office locations in Hamburg

Moorburg

Schnelsen Wellingsbüttel

Fuhlsbüttel B73 Niendorf © Engel & Völkers Commercial Völkers © Engel & Ohlsdorf Harburg Neuland A7

Bramfeld Harburg Eidelstedt Groß Borstel Steilshoop Eißendorf Alsterdorf

Wilstorf A7 Lokstedt Eppendorf Winterhude Barmbek-North Stellingen Dulsberg Hoheluft-East Wandsbek HAMBURG WEST Hoheluft-West Barmbek-South Bahrenfeld Harvestehude HAMBURG EAST Eimsbüttel Uhlenhorst Eilbek Marienthal Rotherbaum Groß Flottbek Altona-North Hohenfelde Schanzenviertel Hamm-North St. Georg Borgfelde Horn St. Pauli Hamm-Central Neustadt Altstadt Othmarschen Ottensen Altona-Altstadt Hamm-South Klostertor HafenCity

Rothenburgsort A7 Steinwerder Kleiner Grasbrook All information has been compiled with the greatest possible care. We cannot accept any liability for the accuracy and completeness of this information. We shall not be held responsible for damage of damage for responsible held be not shall We information. this of completeness and accuracy the for liability any accept cannot We published: care. data possible greatest the and with information compiled been has of information All update Last negligence. gross or intent for liability of exception the with information, this of use the through indirectly or directly either incurred whatsoever kind any Commercial GmbH. Völkers with reference to source, source: Engel & 31. January 2019. Duplication only

City Alster-East St. Georg Alster-West 14,00–29,00 EUR/sqm 12,00–21,00 EUR/sqm 10,00–18,00 EUR/sqm 13,00–24,00 EUR/sqm

Harbour's Edge Altona/St. Pauli Eimsbüttel/Eppendorf HafenCity City-South 15,00–23,00 EUR/sqm 11,50–25,00 EUR/sqm 9,50–16,00 EUR/sqm 15,50–29,50 EUR/sqm 9,50–16,00 EUR/sqm

Harburg Airport City-North Hamburg West Hamburg East 8,50–14,50 EUR/sqm 8,00–14,00 EUR/sqm 8,50–15,50 EUR/sqm 11,00–16,50 EUR/sqm 9,00–14,00 EUR/sqm

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