Market Analysis
BBU annual press conference 2014
BBU reports historic low: vacancy rate in Berlin at just 2.0 percent
The vacancy rate among BBU member companies drops to 2.0%, the lowest since records began in 1995. Even Marzahn-Hellersdorf stands at 1.6%, on par with Kreuzberg.
Peter Guthmann
The Association of Berlin-Brandenburg Housing Companies (BBU) reports a new record low. Among its Berlin member companies, the vacancy rate fell to just 2.0 percent in 2013. This is the lowest figure since systematic recording began in 1995.
Fewer moves, full buildings
Along with declining vacancy, tenant turnover is also falling. In inner-city locations like Mitte, the moving rate is now below five percent. Tenants are staying longer, and changeovers are becoming less frequent.
Marzahn-Hellersdorf on par with Kreuzberg
The development in the outer boroughs is striking. Marzahn-Hellersdorf reports a vacancy rate of just 1.6 percent, matching the inner-city borough of Kreuzberg. Demand pressure has long spread across the entire city. Locations outside the S-Bahn ring are becoming increasingly relevant for tenants and investors alike.
Moderate rent development
Despite the shortage, rents in BBU member portfolios rose moderately. According to BBU board member Maren Kern, the average net cold rent increased by 2.7 percent from 2012 to 2013, reaching 5.28 euros per square meter. For investors holding apartments in Berlin as a long-term investment, this stable rent trajectory provides a predictable basis.
New construction as a response
BBU member companies are responding to the shortage by building more. Investment in new construction rose 160 percent in 2013, with around 1,300 new rental apartments put in the pipeline. For 2014, a doubling of new construction investment is planned, with construction starts for over 1,500 apartments. A total of 18,000 new rental apartments are targeted by 2020.
BBU board member Maren Kern notes, however, that acceptance of new building projects in the immediate neighborhood is often low. An internal association survey paints a different picture: over 80 percent of BBU company tenants view specific construction projects positively. The fact that waiting lists for new apartments are often full well before completion confirms the demand.