Following the gentrification of the German capital, its real estate market has become one of the most active in Europe, with the city attracting investors, corporates and talent from across the world.
In 2017, investors spent more on the commercial office real estate in Berlin than any other city in Germany. With low rent and cost of living, the city attracts a number of young creatives as the number of people living here is growing by about 40,000 every year. The influx of young people is one of the main reasons why today, Berlin is considered to be a hub for fast-growing starts ups as well as big tech companies such as Apple, Google, and Facebook.
As more jobs are being created, the unemployment rates in the German capital saw a decrease and fell to 5.2% in May. With international companies moving their offices to Berlin, the property market is in high demand. The amount of money invested in Berlin offices and other commercial properties grew by 46% to almost 8 billion euros last year.
The high demand for commercial estate resulted in short supply of office spaces. In the first half of 2018, almost 329,00 sqm of office space was completed across all seven strongholds. However, the demand was a lot higher than this. Therefore, the number of completions should be significantly bigger next year with over 1.9 million sqm in the pipeline.
With the population growing and a thriving start-up culture, Berlin will continue to rise amongst other European cities. Although its market is booming, the prices still have a lot of catching up to do with other cities like London and Paris. However, the city will keep changing at a fast pace and make the current investments pay off.