Over the past year, weaker demand in Swiss office space market has been accompanied by a decline in construction activity. Yet other factors have been at play in the financial hotspot of Zurich.
According to real estate specialist Jones Lang LaSalle (JLL), there was only a marginal increase in the supply of office space in Switzerland last year. In the five largest office markets – Zurich, Geneva, Bern, Basel, and Lausanne – the supply ratio of available space increased from 4.5 percent to just 4.6 percent over 12 months, according to a study published on Tuesday.
In absolute terms, this corresponds to an increase of 32,400 square meters to 910,600 square meters.
LGT Opts for CBD, While DZ Privatbank Chooses Seefeld
But if we drill down to the local level, things have started to move. The Zurich office market, for example, has been experiencing a buzz of activity. In the Zurich Central Business District (CBD), LGT, the Liechtenstein private bank, has moved into more than 4,000 square meters at Bleicherweg 30 and in Adliswil to complement its headquarters.
DZ Privatbank and Bank Syz, have rented new offices in Zurich’s city center, whereas Cornèr Bank from Ticino rented office space in Wallisellen. Marsh McLennan and McKinsey, the strategic consultants, have also leased new offices in prime locations.
Flex Space
There are also the new locations of flex space operators Headsquarter, Satellite Office and Flexoffice. At the prestigious address at Bahnhofplatz 1, Signature by Regus and Spaces are letting 5,000 square meters of offices for flexible use.
Demand for inner-city locations may be strong with prime rents unchanged at 925 Swiss francs net per square meter per annum, but the situation is different in peripheral areas. The same is true for older buildings and less well-connected locations. In the Opfikon/Glattbrugg area of Zurich, vacancy rates are the highest nationwide at 29.9 percent, according to the experts at JLL.
Demand for New Projects in Geneva.
In Geneva, Switzerland’s second financial center, demand for offices in a central location remains high. Top rents have increased to 900 from 850 Swiss francs per square meter.
Due to the lack of larger contiguous areas and for sustainability reasons, more office locations on the outskirts of the city are being considered. In the La Praille/Acacias/Lancy sub-market, the supply ratio had sunk to 4.9 percent by the end of 2023. That is remarkable given the recent completions of the ALTO and Esplanade 3 projects in the Pont Rouge district.
As reported by finews.ch, renowned Geneva banks are planning to set up new head offices away from the city center.
Zug Has Lowest Availability
In the Zug region, rental price growth has been supported by sustained demand in the face of an ever dwindling supply. The city of Zug still has the smallest supply of office space (1.4 per cent). At high-quality locations, top rents of up to 550 Swiss francs per square meter are achievable. The biggest decrease in supply has occurred in Baar and Rotkreuz, in the canton of Zug.
But this is expected to grow again from 2026 to 2028 with more than 100,000 square meters of office space. Currently in the pipeline are the Tech-Cluster Zug and Baar, the final last construction plots on the Suurstoffi area in Rotkreuz, and Building F on the Papieri site in Cham.
