If you want to rent office space in Cologne these days, you either need deep pockets or lots of luck – or better yet, a good portion of both. That’s because vacancy rates have reached record numbers in the city with the dome. Very few spaces are still available for rent; and if they are, prices are exorbitant due to an almost dramatically high surplus in demand.
Cologne Market is extremely tight
Florian Schmidt, Director Commercial Real Estate with Cologne’s realtor Greif & Contzen, is quoted in trade publications: “The Cologne market for office space has seen vacancy rates that have gone down so significantly that interested companies are facing a pricey question in the double sense of the word.” Experts from his firm have published an in-depth report on the situation in Cologne, analyzing the first three quarters of 2018. The results bear a sharp increase in scarcity and a very strong rise in rental tariffs. Until year’s end, vacancy rates are expected to drop to 2.7 percent in Cologne, which would constitute yet another tightening.
Office rental rates in Cologne have already risen at an above-average rate since 2016, with no end of those developments in sight. Experts see one of the reasons in the lack of new construction – so far, only 55.000 new square meters of space have entered the Cologne office market in 2018, on average about a quarter less than in each of the five previous years. On top of that, the number of people living in Cologne is rising – all economic data point to an economic boom. North Rhine-Westphalia’s largest city serves as a magnet for the creative service sector, many media companies and startups from different walks of life. In recent years, old industrial fallows on the right bank of the river Rhine were refurbished and rededicated into office spaces, which helped to alleviate the problem to a certain degree. However, that potential has been exploited and can’t be pursued further.
Coworking and Business Centers are Part of the Solution
Companies don’t have much choice but looking for new conceptual solutions. Coworking spaces and Business Centers are more and more becoming a part of the equation. COLLECTION will open a new business center in Cologne next year: The new location will be named “Köln City Rudolfplatz” and, if all goes well, will be open for business in the third quarter of 2019 as part of the newly constructed Wallarkaden.
Dr André Helf, CEO of COLLECTION Business Center Group, hopes to contribute to relieving the Cologne office space market with the new business center: “Of course we know how difficult the Cologne market situation is. Our new business center will be at a top location in the heart of the city. Clients will enjoy a wonderful view of historic Rudolf Square. I invite those who’re interested to visit our website, where we feature a model picture of what the new venue will look like.”
Dr Helf underscores that COLLECTION Business Center will implement all other conceptual staples, proven at the company’s existing six business centers, in Cologne as well: “As always, there will be no long-term lease contracts if the client doesn’t want that and or can’t assess future financial risks. The layout of the rooms will be adapted to the clients’ needs. We will offer Coworking as well as Virtual Offices in Cologne as well. And of course, we understand that our customers need different work environments, such as quite zones, conference zones or creative zones. Our customers will indulge our regular five-star service, with the discretion we are known for and the support of our highly trained staff. As a matter of course, our presentation tools and other office equipment will meet the highest standards of digitization and technical enhancement. All of that will come at a very fair price.”
Flexibility - a key issue
Flexibility will be one of the most important elements in Cologne as well – a quality COLLECTION has proudly incorporated as one of its key philosophies. An angle supported by Florian Schmidt from Greif & Contzen: “Conceptual programs based on the flexibility of work environments and spaces will definitely gain importance in the future.”
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