Colliers Market Report Denmark 2023

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Office - Colliers Market Report 2023

Hotel I ndustrial & logistics Retail Residential Office

account, along with rising utility charges. In our opinion, this could potentially cause landlords to hold back for fear of an increase in vacancies even in the medium term. However, in a wider context, Copenhagen office rents are still relatively low. In other European metropolises, the office CBD rent exceeds the rent commanded by offices even in the very best Copenhagen locations. In the cap ital cities of two countries neighbouring Denmark, viz. Stockholm and Berlin, the prime office rent is as high as DKK 6,100 per sq m p.a. in Stockholm and DKK 4,100 per sq m p.a. in Berlin, topping even the highest office rent level of approximately DKK 2,200 per sq m p.a. in the Copenhagen CBD.

in e.g. Copenhagen, where demand outstrips supply and where tenants will accept higher rents. On the other hand, less sought-after locations will not necessarily see a corresponding increase in market rents or a “new nor mal” in the short term, at least not on the same scale. Such areas do not have the advantage of exceptionally low vacancy rates, but are subject to ordinary supply and demand mechanisms, where factors like competition and a range of options for the tenants to choose from help to curb possible rent hikes. Despite the uncertain rental outlook, it has become abun dantly clear, however, that tenants are taking more steps than previously to ward off substantial rent increases by demanding a contractual cap on rent adjustments, typi cally 4-5%, with this demand no longer a side note but a key element of future rent negotiations.

Nevertheless, we believe that indexation will drive up market rent levels in particularly sought-after locations

Post-2022 Future tenant focus is on contractual provisions for cap on rent increases

Pre-2022

Lease agreement Agreed rent Non-terminability

Lease agreement Agreed rent Non-terminability Rent discount

Lental dis Cap on rent increases

Cap on rent increases