Helsinki’s business property market shows signs of recovery

Helsinki’s city centre has maintained its strong position in the property market even through the difficult years.

The market for business premises in the Helsinki region is showing signs of recovery in the aftermath of the financial crisis, which cut the property trade to a fraction of the level enjoyed during boom years of 2006-2007. This year’s business property deals in the Helsinki region, until the end of April, total about EUR 550 million, of which more than 70% has involved domestic investors.

Helsinki’s city centre has maintained the interest of both investors and tenants, with business property rents increasing consistently even through the difficult times. Prime property rents in the city centre are currently at an all-time high, with companies paying an average of EUR 128 per square metre for their premises.

Some parts of the Helsinki region have been experiencing an over-supply of office space in recent years but the rise in the total vacancy rate now seems to have halted. Demand is expected to increase with the brisk growth of the Finnish economy, although rents will probably remain stable except in the city centre.

There is currently more than one million square metres of vacant office space in the Helsinki region. Ongoing developments will bring an additional 100,000 square meters of office space to the market in prime locations with excellent travel connections. Some empty office buildings are expected to be redeveloped into apartments, hotels and for other uses.

Source: Helsingin Seudun Suunnat