Office property market pbbIX still on the slide

  • pbbIX records second consecutive fall and is now significantly below zero
  • Competition for ecologically sustainable space in prime locations remains strong


The German economy is moving sideways. Following a decrease of 0.5% in the third quarter of 2022, real gross domestic product remained unchanged during the first quarter of 2023, and investors are adopting a distinctly wary approach both on the market for office space and on the investment market despite a cautiously optimistic outlook for the remainder of the year. As a result, the pbbIX real estate index recorded a second consecutive quarterly fall and ended the first quarter of 2023 significantly below zero, i.e. below the boundary between growth and contraction. 

In terms of the letting performance, the market for office space has weakened: only around 600,000 sqm were let on the big 7 markets in the first quarter, approximately 30% less than in the previous year, which is mainly due to the weak economy and associated corporate cost-cutting. Mobile working and desk sharing are also reducing demand for space and triggering adjustment processes, which in turn lead to less space being absorbed.

Pressure on the investment market continued unabated in the first quarter of 2023, with inflows in the big 7 markets plummeting to an investment volume of just under €1 billion for office properties. This is the lowest level recorded since the third quarter of 2009, at that time marked by the financial markets crisis. A changed lending and capital markets environment, the looming weaker market for office space, and still comparatively high purchase prices all pose challenges for many potential investors. Pricing for office properties is therefore undergoing a difficult process, and large-volume transactions, in particular, are rare.

Whilst the individual markets are all trending downwards, painting a uniform picture, prime rents are on an upward trajectory – despite stagnating or even increasing vacancy rates. Competition for ecologically sustainable space in prime locations thus remained strong.  

The complete report for the first quarter of 2023 is available at