OFFICE REAL ESTATE MARKET Q4/2024

The Prague office market closed 2024 with a record volume of transactions but a significant supply deficit and ongoing challenges for tenants. Vacancy rates dropped to 7.3%, indicating limited availability of high-quality spaces, particularly for larger companies seeking new headquarters. Rents continued to rise across the market, especially in premium locations where the supply of new spaces has nearly been exhausted. New office construction has effectively stalled, further exacerbating the imbalance between supply and demand. The total office space in Prague reached 3.96 million sq m, but most new projects were pre-leased before completion. The outlook for 2025 suggests no major changes – the market will remain landlord-driven, while tenants will face rising costs and limited relocation options. This situation may result in a higher number of renegotiations of existing leases as companies have insufficient alternatives.