Île-de-France office market cools down

 

The office property market in the Île-de-France region experienced a notable slowdown in the second quarter of 2025. According to data from Immostat and analysis by JLL, office transactions plummeted by 22% compared to Q1 2025, reaching 337,000 sq m. This represents the lowest level since Q1 2021. Year-on-year, the decline stands at 8%.

 

Cumulatively for the first half of 2025, placed demand totaled 768,000 sq m, down 11.5% from H1 2024 and 25% below the ten-year average. This trend indicates increased caution among businesses, leading to prolonged decision-making processes for office space.

 

Regional Variations in Demand

 

Paris Central Business District (QCA): Demand remained relatively stable year-on-year (-1%).

Rest of Paris: Saw a significant drop (-40%).

La Défense: Showed a slowdown in Q2, resulting in an 11% decrease over H1.

1st Suburb: Experienced growth of 22%, partly attributed to a large public sector transaction.

 

The market for large transactions (over 5,000 sq m) was particularly affected, with a 30% decrease in both surface area and the number of deals.

 

Vacancy rates and rents: a mixed picture

 

The overall vacancy rate in Île-de-France reached 10.8%, representing nearly 6 million sq m of available office space. Hotspots include La Défense with a 15.6% vacancy rate, while the Paris QCA also saw an increase, reaching 4.7%.

 

Rent trends are diverse across the region:

 

Paris QCA: Experienced a strong increase (+20%) with prime rents reaching 1,200 €/sq m.

Paris Centre West: Also saw rents rise (+8%) to 940 €/sq m.

Periphery: Rents are more stable or even declining. La Défense saw a modest increase (+4%) to 550 €/sq m, while the Northern 1st Suburb saw a significant drop (-10%) to 360 €/sq m.

 

Impact of regulations

 

Compliance requirements from the Dispositif Éco Énergie Tertiaire (DEET) energy efficiency regulations are adding to costs for businesses. This is prompting some companies to either renegotiate their leases or consider relocating outside central Paris.

 

Market outlook

 

The Île-de-France market is expected to remain subdued throughout 2025, with forecasts predicting placed demand between 1.6 and 1.7 million sq m for the full year.

 

Investment trends

 

Despite the slowdown in leasing activity, real estate investment in France saw a positive trend in H1 2025, totaling 4.4 billion euros (+30% year-on-year). Office investments specifically amounted to 2.2 billion euros (+29%), with Île-de-France attracting 3.7 billion euros, a significant increase of 85% compared to 2024.

 

Source: batiweb.com