European Office Occupier Markets

Track and compare 36 key real estate markets in Europe with our interactive Office Rental Clock

Conditions in the European economy in the second quarter softened. As a result of global supply chain disruption arising from China’s zero-covid strategy, the war in Ukraine and escalating sanctions regime, and the residual impact of pandemic-related bounce-back, commodity and energy prices increased and were more volatile. Gas, coal and electricity prices recorded record highs, affecting industry and consumer even as home heating demand eased as the weather warmed. Meanwhile oil prices climbed on US, EU and UK intentions to ban or phase out Russian oil. Rising energy and food prices were the primary driver of domestic price pressures across the region, though second order effects from higher transportation costs and availability shortfalls saw price rises spread more widely. Tight labour markets, a positive overall, contributed to wage increases, helping to spread inflationary pressure further afield. Exceeding the pace of wage growth though, inflation eroded real household incomes and spending power, and caused confidence to plunge to levels equivalent to those seen in the depths of the first lockdown. Forecasts for GDP growth rates this year have been revised down incrementally as headwinds have strengthened. However, they remain above trend rates of expansion due to residual benefit of loose fiscal, monetary and regulatory loosening during the pandemic.

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JLL's Office Rental Clock demonstrates where each market sits within its rental cycle.
European Office Rental Clock
Exit city view

Source: JLL, June 2022

Note:
  • This diagram illustrates where JLL estimate each prime office market is within its individual rental cycle at the end of June 2022
  • The COVID-19 pandemic has had a material impact on real estate investment market performance. Across EMEA there is considerable variation in the extent of the human and economic impacts and the policy response. Regular real estate market activity has been disrupted, and the volume and range of transactions reduced compared with other periods, affecting the performance, trajectory and magnitude of market impacts. Every effort has been made to ensure the data published provides a quantitative and robust assessment of value at our survey date of 30th June 2022. Where prime real estate transactions have not occurred and evidence of actual market performance is absent, notional assessments have be made on the prevailing conditions using our experience and considered judgement.
  • Markets can move around the clock at different speeds and directions.
  • The diagram is a convenient method of comparing the relative position of markets in their rental cycle.
  • Their position is not necessarily representative of investment or development market prospects.
  • Their position refers to Prime Face Rental Values.

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