Press release   NAI apollo: Frankfurt office lettings market continues to pick up in Q2 2025

Frankfurt am Main, 1st July 2025 – Following a record-breaking start to the year, the Frankfurt office space market including Eschborn and Offenbach-Kaiserlei continued to register high levels of market activity in the second quarter of 2025. After space take-up by tenants and owner-occupiers amounted to 202,100 sqm in the first three months of the year, 143,100 sqm was registered for the second quarter, according to an analysis by NAI apollo, a member of NAI Partners Germany.

This brings the half-year result to a total of 345,200 sqm, exceeding the previous year’s figure by 90 % (H1 2024: 181,500 sqm). The volume was also more than double the five-year average, and 73 % above the average for the past ten years. “The positive trend that was registered at the beginning of the year is continuing, and can be seen as a turning point in the current cycle,” said Martin Angersbach, Director Business Development Office Germany at NAI apollo.

As the latest figures from the DIW economic barometer show, sentiment in the German economy is slowly but steadily improving. At 94.2 points in June 2025, it is still below the neutral 100-point mark, but has reached its highest level for around two years, providing further signs of a macroeconomic recovery. A more positive sentiment is also evident at local level on the Frankfurt market. According to the early-summer survey carried out by the Frankfurt am Main Chamber of Industry and Commerce, the business climate index has continued to rise. Local companies engaged in the financial services, credit and insurance sectors are particularly optimistic. “The latest indicators and surveys currently point to a moderate improvement in the economy. This could be a harbinger of rising demand for office space, including in medium-sized and smaller space segments, although further geopolitical risks could once again have a dampening effect,” said Dr Konrad Kanzler, Head of Research at NAI apollo.

Large deals aid market revival

“The market recovery in the first half of 2025 was largely fuelled by deals above 5,000 sqm. These deals accounted for well over 60 % of take-up, which in turn increased by over 300 % to 214,500 sqm compared to the previous year,” said Michael Preuße, Head of Office and Retail Letting at NAI apollo. There were seven notable deals of over 10,000 sqm, including two contracts signed by KPMG: the lease of the entire “Parktower” with around 20,700 sqm of office space and the pedestal construction of the “Opernturm” with 12,700 sqm. In addition, Condor leased around 15,200 sqm in “Alpha Rotex”. In addition, Deutsche Rentenversicherung Hessen took up around 13,000 sqm in “City Haus I”, with NAI apollo acting as adviser to the owner.

Market activity dominated by banks, financial service providers and insurance companies as well as management consultancies

Owing to these agreements as well as the large lease contracts signed by Commerzbank for 73,000 sqm and ING Germany for 32,000 sqm in the first quarter, the ‘banking, financial services and insurance’ sector and companies from the ‘management consultancy, marketing and market research’ sector were responsible for the largest take-up volumes in the first half of the year with a total of 124,900 sqm and 42,400 sqm respectively. Next were the ‘public sector’ with 38,800 sqm and ‘law firms, notaries and legal advisers’ with 25,300 sqm. In terms of the geographical distribution, the Central Business District (CBD) recorded take-up of 201,800 sqm, which corresponds to almost 59 % of total market activity. Within the sub-markets, the banking district stands out with 106,100 sqm, followed by Westend with 56,400 sqm, east Ostend with 52,700 sqm, the city centre with 22,400 sqm and the airport sub-market with 21,000 sqm.

Prime rent reaches €52.50/sqm

The continued high proportion of lettings in projects, new builds and refurbished buildings led to a further increase in rental prices in the second quarter. Almost 60 % of take-up over 1,000 sqm took place here. This includes, for example, the KPMG lease in the planned refurbishment of “Parktower”. The prime rent has increased by €1.00/sqm in the last three months to €52.50/sqm. In a year-on-year comparison, the rental level increased by €5.00/sqm or 10.5 %. “The large-scale and high-priced CBD deals have also had a significant impact on the space-weighted average rent. At the end of the first half of the year, this stood at €31.20/sqm — an increase of €6.60/sqm or 26.8 % within the last twelve months,” said Kanzler.

Sideways movement in the vacancy rate

“The market-active vacancy rate on the Frankfurt office market had already stopped rising in the first quarter of 2025, and there was further stabilisation towards the middle of the year. At the end of June 2025, around 1.24 million sqm were still available to rent on the market at short notice,” said Angersbach. However, vacancies have increased by 154,000 sqm compared to the same period of last year. At 10.8 %, the current vacancy rate is 1.4 percentage points higher than in the second quarter of 2024.

Office stock at the end of the second quarter of 2025 amounted to around 11.46 million sqm. Completions in the quarter totalled over 6,300 sqm of office space. “Das Palais”, for example, contributed 3,600 sqm to the figure. In the last three months, space that was removed from the office market totalled 77,500 sqm. Some of this — such as in “Parktower” — will be added to the stock once the refurbishment has been completed.

Based on current information, a total of over 111,000 sqm of office space is expected to be completed in 2025. Of this, 48 % has already been pre-let. For 2026, completions are expected to amount to 107,000 sqm, of which 57,700 sqm are still available for rent. “With the continued focus on modern, ESG-compliant newly built space, it can be assumed that only a small proportion of space in these project developments will remain vacant after completion,” said Kanzler.

The beginning of a market recovery

“The improvement in sentiment among Frankfurt companies can be seen as a harbinger of an economic upturn, which is already reflected in the key office market figures. With the expected economic recovery in the coming quarters, we will also see greater momentum on the Frankfurt office market. Since the first half of the year saw a large number of major deals, activity in the second half of the year is likely to be somewhat more moderate, but will still stand out significantly from the last three years,” predicted Preuße. Accordingly, the sideways movement in vacancies should continue for the time being, with a decrease expected again in the medium term as the volume of take-up increases. At the same time, the shortage of centrally located and high-quality vacancies will cause rents to rise further.