Office Real Estate Activity in Germany declined further in the 4th quarter – pbbIX drops significantly to -1.38 points

  • Investment and office space markets significantly weaker in 2020 than in the previous year


The economic situation in the German office real estate market has slowed down further in the 4th quarter 2020. The office market index pbbIX, which represents the seven most important office property markets in Germany, has fallen to -1.38 points compared to -0.7 points in the 3rd quarter 2020. Within one year and under the influence of the COVID-19 pandemic, the office market economy has thus turned from expansion – with an index level of 0.83 points for the 4th quarter 2019 – over recession to crisis. Two key figures correspond with this development: The investment volume in the office real estate market fell from €29 bn in 2019 to €17.8 bn in 2020 and the newly leased space from 4.1 mn sqm to 2.7 mn sqm. The Corona crisis continued to impact the office markets at the beginning of the year 2021. Overcoming the pandemic is a necessary basis for a recovery of the markets.

Also in the 4th quarter the demand for office space stagnated further and was significantly below the previous year´s level. New space was well absorbed due to high pre-lets. Vacancy rates picked up again, although this indicator remained mostly at a low level. Therefore rents have been largely stable to date.

Inflows stabilised in the 4th quarter on a below-average level. Initial yields for first-class properties experienced a slight loss due to the decline in capital market rates and investors seeking quality and safety.

Economic activity in the regional markets is currently developing differently, although all submarkets are showing the same weakening trend. The best performance was seen in the 4th quarter at the Berlin office property market, which – with an index level of 0.85 points – is still in recession, while the other submarkets have slipped into economic crisis.

Please find all details in the report for the 4th quarter 2020 here.


Notes to the editors:
The pbbIX ( index family comprises a composite index, as well as seven sub indices tracking the key German office property markets of Berlin, Cologne, Dusseldorf, Frankfurt/Main, Hamburg, Munich and Stuttgart, including their respective catchment areas.

pbbIX describes the development of the office markets. The zero line corresponds to the long-term trend. If the index is above the zero line, the office market is better than the long-term average. From a value of 1.0 points, one speaks of a boom.

The indices, which pbb publishes in cooperation with vdp Research, provide investors and lenders with comprehensive information on the current performance of office properties in Germany.

pbb Deutsche Pfandbriefbank ( is a specialist lender for commercial real estate finance and public investment finance in Europe and the United States of America.