Office supply continues to grow
The supply of available space in Switzerland's five largest office markets will continue to increase in 2024. This is according to a study by Jones Lang LaSalle. The property company expects construction activity to increase this year and in the next two years.
The vacancy rate for office space in Switzerland has increased further in 2024, Jones Lang LaSalle(JLL) reports in a press release on its new office market study. In it, the commercial property and investment management company examined developments in the largest office markets. In the five largest office markets of Zurich, Geneva, Bern, Basel and Lausanne, the supply of available office space increased by 9 percent year-on-year to 995,500 square metres at the end of 2024.
Construction activity for office space is expected to have bottomed out at 57,000 square metres in the reporting year, according to the press release. After peaking at around 343,000 square metres in 2020, newly constructed office space had steadily declined in the following years. JLL expects construction activity to increase again in the current and next two years.
Overall, demand for space remains intact, writes JLL. The company has observed high demand for modern, flexibly usable space with good transport connections. Space in older buildings without a railway station within walking distance, on the other hand, is more difficult to let.
JLL expects the market for office space to pick up momentum in the future. “Many market players are confident about the coming months and want to utilise the improved investment environment for transactions,” Jan Eckert is quoted as saying in the press release. According to the CEO Switzerland & Capital Markets Lead DACH at JLL, this trend can be seen in both the quantity and quality of incoming bids. “The short-term prospects are more favourable than they have been for three years.”