Key office figures and insights for the Greater Paris Region
The upturn in the rental market seen over Q1 continued. A cumulative 765,600 sq m of office space transactions has been recorded since the beginning of the year (+14% year on year).
Year-on-year increases were seen across all space segments.
A more substantial increase in immediate supply was seen over the last quarter (+225,000 sq m) taking levels to over 4 million sq m resulting in a vacancy rate of 7.3%.
Once again, there was little quarter-on-quarter change in rental values. The prime rent therefore stood at €920 per sq m/year in the Paris CBD and €550 per sq m/year in La Défense.
As expected, investment activity in the Greater Paris Region was calm over Q2 with scarcely €1.9 billion in investments taking the overall volume for H1 2021 to €5.2 billion. These figures are down by -35% year on year, are -36% lower than the average for the last 5 years and -23% below the 10-year average.
Offices were largely in the majority and accounted for 87% of the investment volume over H1.
Although most prime yields in the Greater Paris Region remained stable over Q2, there was some decompression in areas with high levels of supply or those with mainly large-format assets that are more difficult to finance.
French investors accounted for 67% of the investment volume over H1 2021. International activity remained significant, particularly over Q2 (49% of the investment volume).