At 129,700 sqm, Berlin take-up in the first quarter was 37% lower than an average first quarter of the previous five years. This was caused by the lack of space in existing stock, the now very high rent levels, the slowdown of the economy since the second half of 2019 and the fact that many large space requirements have already been met in recent years. On a y-o-y basis, the prime rent rose by 14.3% and the average rent by 19.7%. In no other German city do companies pay as much rent on average for new office leases as in Berlin.
With the shutdown of gastronomy and shops in mid-March, most non-food retailers and restaurants paused their searches. Only retailers of essential goods were allowed to continue operation.
Demand for warehouses and distribution space remained at a high level, mainly driven by demand from retailers and e-commerce-distribution, whereas requirements from manufacturing and 3PLs declined in mid-March when it became obvious that, among other segments, the car industry would be hit hard by the Covid-19 pandemic. In Q1 new leasings and construction starts for owner occupation reached 1.24 million sqm and thus almost the same level as the equivalent quarter in 2019.
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