Swiss office market sees decrease in demand

With a rate of than 5%, office vacancy rates in Switzerland were comparatively low by European standards, according to the study report. © Keystone / Gaetan Bally

Office space vacancies are on the rise in Switzerland. However, prices are expected to only fall slightly, given the presence of numerous potential buyers with purchasing power.

In Switzerland’s five largest office markets – Zurich, Geneva, Bern, Basel and Lausanne – there was slightly more vacant office space at the end of 2023 than in the previous year. This is according to an office market study published on Tuesday by consultancy firm Jones Lang LaSalle (JLL).

Specifically, the supply ratio rose by 0.1 percentage points to 4.6% within 12 months. The supply increased in Zurich and Geneva, while it remained stable in Bern and fell slightly in Lausanne and Basel compared to the previous year.

Comparatively low vacancy rate

With a rate of than 5%, office vacancy rates in Switzerland were comparatively low by European standards, according to the study report. The average vacancy rate in European cities last year stood at 7.7%.

Cities such as Dublin, Budapest, Stockholm and Lisbon recorded vacancy rates of around 10%. According to the JLL experts, comparable rates in Switzerland can only be found in Opfikon and Wallisellen in the Zurich conurbation and in the airport region of Geneva and Lausanne West.

Fewer purchase deals

The report also shows that demand for office space decreased towards the end of the year after a surge in the first half of 2023. However, this development has “not yet had a significant impact on the development of supply”.

The study authors note that the office market in Switzerland is liquid. However, there is currently a reduction in the number of concluded purchase deals compared to the situation abroad. This is attributed to differing expectations between sellers and buyers. However, there are selective signs that sellers might be willing to accept lower prices, though the pricing and revaluation phase is still underway.

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