Key office figures and insights for the Greater Paris Region
Q3 2020
Investment market activity recovers while the rebound on the leasing market is slow to come
Leasing Market
The much-anticipated recovery that was expected to be seen in in the rental market in September failed to materialise and Q3 was no more active than Q2 with 246,000 sq m of take-up; this took the year-to date figure to 913,200 sq m by the end of September.
The level of immediate supply across the Greater Paris Region has been rising since the end of 2019 and now stands at 3.3 million sq m (+21% over the last 9 months), representing a regional vacancy rate of 6.1%.
The COVID-19 epidemic has not yet had an impact on prime rental values. In the Paris CBD, our calculations for the prime rent (10% of the highest transaction values over the last 12 months, across all office types) reveal a further increase over Q3 to €900 per sq m/year.
Investment market
By the end of September, the year-to-date investment volume for the Greater Paris Region reached €11.6 billion; this represents a -31% decrease compared with the record level seen in 2019.
Lower volumes were seen across all segments, apart from the €100 - €300 million segment which remained stable year on year with €3.4 billion in investments over the Q1-Q3 period.
With €9.4 billion in investments by the end of September, office assets remained firmly in the majority (83%).
French investors dominated the market with a record 74% by volume; this year-on-year increase was particularly due to the lack of Asian investors who accounted for 11% of investments in 2019 as well as the withdrawal of foreign investors due to the COVID-19 epidemic.
