Office Vacancy

During the last 20 years office vacancy has become a visible problem of the German real estate market. Whereas the average vacancy rate of the biggest 125 German cities was only 1 percent in 1990, the rate soared to 7.5 percent in 2010. In the seven German metropolises the average vacancy rate is even above 10 percent. In spite of increasing vacancy new office space has been built so that even with increasing demand the vacancy has not been reduced significantly. Since vacant buildings have a negative impact on neighboring buildings and block the efficient use of space, for instance for housing purposes, office vacancy is not only a problem for the owners but also for society. Given the expected reduction of labor force due to demographic change, a further reduction of office demand is expected so that solutions to dampen the vacancy problems are urgent.

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