Office vacancy rates are rising across major Swiss cities, even as new office developments are expected to grow in the coming years, according to a recent study.

The supply of unoccupied office space in Switzerland’s five largest markets—Zurich, Geneva, Bern, Basel, and Lausanne—rose by 9% in 2024 compared to the previous year, according to a report released on Tuesday by real estate consultancy firm Jones Lang LaSalle AG (JLL).

Continuous increase in vacant office space

The upward trend in vacant office supply has persisted since 2019, coinciding with the gradual adoption of remote work. Since 2020, the total area of unoccupied office space has expanded by 231,000 square meters. Simultaneously, 1.16 million square meters of new office space were developed between 2020 and 2024.

Despite the rising availability of office space, Switzerland’s vacancy growth remains moderate by international standards. Over the same period, the average office vacancy rate in 24 European cities climbed by 3.3 percentage points to 8.5%.

Variations in new office development

Although construction activity in the Swiss office sector peaked in 2020 and subsequently declined, JLL analysts forecast a resurgence in new office construction between 2025 and 2027, with annual growth in office stock projected at 1% through 2027.

However, regional disparities are notable. Geneva and Bern are set to see substantial new office developments, while Zurich and Basel are likely to witness slower growth during this period.

Preference for Modern, Well-Located Offices

Demand remains high for modern, flexible office spaces with sustainable features and excellent connectivity. In contrast, older office buildings, especially those located far from public transport, face greater difficulty in securing tenants.

Market outlook: cautious optimism

Despite uncertainties stemming from evolving workplace models, the study’s authors maintain a positive outlook on office demand, supported by Switzerland’s solid economic and employment growth. Investors remain watchful, particularly as more adaptable workplace designs complicate future space projections.

Jan Eckert, head of Switzerland and capital markets at JLL, highlighted the market’s resilience, emphasizing growing investor interest driven by favorable short-term prospects and low interest rates. “We are seeing both higher volumes and better quality in incoming bids, with short-term outlooks appearing more promising than at any time in the past three years,” Eckert noted.