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Cologne in real estate chaos: commercial real estate market collapses by 54%!
The commercial real estate market in Cologne will record a 54% decline in 2025. Experts expect a recovery in the medium term.
Cologne in real estate chaos: commercial real estate market collapses by 54%!
The Cologne commercial real estate market experienced a dramatic 54 percent decline in transaction volume in the first nine months of 2025 compared to the previous year. This reports iz.de. While the reasons for this decline are varied, experts point to special effects in 2024 that resulted in higher sales. Market uncertainties and geopolitical influences also appear to be playing their part.
In 2023, a transaction volume of 800 million euros was recorded for commercial real estate in Cologne, which has almost tripled compared to 2022. However, there are signs of a possible revival of the Cologne real estate investment market, as the real estate experts from Greif & Contzen on the occasion of EXPO REAL in Munich.
Market development and opportunities
A slower market recovery, which has been observed since the beginning of the year, could be supported by the significant decline in interest rates. The European Central Bank (ECB) has ended its interest rate hike cycle in autumn 2023, reducing risks for investors. Nevertheless, geopolitical uncertainties and inflation risks remain significant challenges.
Highlights of the market include several major transactions, including the acquisition of exhibition halls 6-9 including the Congress Center North by the city of Cologne and the purchase of northern building sites in Laurenz-Carré by Hanse-Merkur Grund Vermögens. However, the office real estate sector is showing restraint as buyers are demanding high price discounts due to necessary modernization work.
Market analysis and price developments
A, like that Real Estate Association Germany (IVD) published shows a growing demand for modern office space that meets ESG criteria and is positioned in central locations. More and more companies are turning their office spaces into flexible zones for communication and collaboration.
The vacancy rate for older existing properties outside the city center has risen sharply. This can be seen, for example, in a rate of 6.7 percent in Berlin and 10 percent in Frankfurt. A look at the prices for commercial building plots reveals that they have barely kept pace with inflation over the last 15 years. A square meter of building land in a medium or good location currently costs around 36 to 38 percent more than in 2010, although real prices have fallen by 5.7 percent compared to 2023.
In summary, the Cologne commercial real estate market shows a mixed picture: While the current situation is characterized by a significant decline, there are also bright spots in the form of opportunities and a gradual recovery. Companies and investors should not remain idle, but rather make the best of the situation and pursue innovative approaches.