The Impact of Working from Home on the German Office Real Estate Market

BIG-DATA-BASED ECONOMIC INSIGHTS

Simon Krause, Andreas Trumpp, Tobias Dichtl, Susanne Kiese and Alexander Rutsch

Key Messages

  • A quarter of the workforce regularly works from home, oftentimes blending office and remote work
  • The office market is undergoing a stress test, with challenging conditions expected to persist 
  • The permanent shift toward working from home (WFH) is expected to decrease long-term office space demand by around 12 percent 
  • In industries with high WFH rates, new office leases show a flight to quality with higher rents
  • An office building’s ability to meet the growing “new work” demands is now a key leasing factor
Abstract

A quarter of employees in Germany regularly work from home (WFH), which is often a mixture of office and remote working. The office market in this country is undergoing a stress test and the steady shift to WFH will significantly reduce demand for office space in the long term.

Citation

Simon Krause, Andreas Trumpp, Tobias Dichtl, Susanne Kiese and Alexander Rutsch : "The Impact of Working from Home on the German Office Real Estate Market," EconPol Forum 25 (5), CESifo, Munich, 2024.