The home office trend is increasingly leading to an increase in the demand for more flexible office space – in the status quo, however, such buildings are still considered rarities on the real estate market.
New building complexes despite the pandemic
As the real estate service provider Fay Projects announced on its company website, the Mannheim-based company is currently building a new building complex in the Braunsfeld district of Cologne. This will consist of five parts and provide around 27,600 square meters of rental space. The implementation takes place in cooperation with the project developers Alfons and Alfreda from Düsseldorf. “Under the current difficult conditions, such a fast, extensive rental is a major milestone for the project,” explains Clemens Rapp, managing director of Fay Projects, to the business news website WELT.
Rental of office buildings in times of Corona and before
The pandemic-related relocation of everyday work from the office to your own four walls makes it difficult to rent office space, so that rapid marketing of a building complex of 27,600 square meters is not a matter of course. According to information from the real estate consultancy Colliers International, which is available to WELT, leases for around 2.55 million office square meters were either newly concluded or extended in 2020 – the seven largest cities in Germany were taken into account. An amount that seems very high at first, but only represents just under 35 percent of the rented office square meters compared to 2019. Stephan Bräuning, Head of Office Letting at Colliers International in Frankfurt, sees the “pandemic-related insecurity of companies”, as he tells WELT, as the reason for this.
Break in the office property market
Mareike Lechner, board member at the Berlin project developer Immobilien -experts-Ag, comments on the current situation on the market for office properties to WELT as follows: “The number of rental inquiries has decreased significantly due to Corona. It is as if many companies have pressed the pause button. ”Thomas Beyerle, chief researcher of the real estate consultancy Catella, expresses himself cautiously towards WELT when it comes to the future prospects for the leasing of office space. He explains that it is not known whether new waves of infections will lead to further lockdowns and thus affect the economic situation again. He goes on to say: “The question is to what extent the pandemic will change the world of office work in the long term.”
New demands on office space
The translocation of the work environment, as well as the suspension of a large part of business trips, leads to new demands on office buildings. New workplace regulations for dealing with COVID-19 could also mean that companies would have to let their employees work at a greater distance from one another. “Many companies calculate that the desks will be one meter further apart and the meeting rooms will have to be enlarged”, Thomas Beyerle, chief researcher of the real estate consultancy Catella, told WELT. “This would increase the space requirement by ten to 15 percent, even if more employees would work from home one or two days a week than before the pandemic.”
Modern room solutions
Beyerle also explains: “A lot of tenants want this […] highest flexibility. They are looking for modern space, which they can both expand and reduce at short notice if necessary. ”Due to the current situation, which cannot yet provide the desired adaptability, according to WELT there are fewer contracts and negotiations regarding follow-up contracts for office properties. Many companies are currently looking for new space and are therefore trying to get rid of their old leases. Hans-Joachim Lehmann, managing director of the Hamburg real estate investor Warburg-HIH Invest, told WELT that landlords should offer flexible usage concepts in the interests of companies. “The demand for it is increasing and will change the office market significantly,” he continues. Accordingly, it is important to have “modern room solutions with innovatively designed work and conference areas as well as comfortably designed retreats.”
The increased use of video conferences leads to an increased demand for solutions to expand the digital infrastructure, Lechner explains to WELT – a fact from which the project developer benefits. He had his campus “Am Oktagon” in Berlin-Adlershof built taking highly efficient technology into account. “The 5G network, which will be the first campus network in Berlin to go live in Adlershof this year, is an advantage for us,” says Lechner. The digital expansion of the complex is very popular, as 30,000 of the total of 85,000 square meters of office space is already rented, although it will not be completed until 2025.
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