The office market had stabilised in recent years – until employees suddenly began working from home as a result of the pandemic, reversing the trend. As a result, available office space in the Swiss agglomerations rose by 23% within a span of six months in 2020 to 2.26 million m2. Few regions posted a slight decline, with most agglomerations seeing a sharp rise in supply. The amount of excess supply in 2020 would have been much higher had it not been for long-term contracts in the office market. The pandemic caused a significant amount of uncertainty for companies. Many office tenants postponed decisions related to office space planning. Others used the increase in the number of employees working from home to plan or actually reduce space in order to achieve cost savings. Tenants have become aware of their much stronger negotiating position, which led to corresponding incentives for rental contracts concluded in 2020.

Overall, most rents fell. However, there were major differences in terms of location: in agglomerations, empty office space was and is under strong competitive pressure due to the excess supply. Yet demand rose in central locations in major centres. Location factors, such as an urban environment with attractive dining and leisure options or proximity to clients and peers, have become increasingly important as a result of the pandemic. It is becoming increasingly clear that value creation, productivity and social relationships in the workplace require a certain amount of personal interaction. As a result, the contrast in trends among the various locations are likely to become more pronounced in 2021. In addition, bankruptcies that had been postponed as a result of economic programmes and savings measures by many companies will result in even more space coming on to the market – particularly in the form of attractively priced subleases.