Tuesday, 9 June 2026
The Prague office market is experiencing increasing pressure from a shortage of modern office space, with many occupiers choosing to extend existing leases rather than relocate, according to Savills.
The property consultancy reports that only three of the twenty largest office transactions completed during 2024 and 2025 involved companies moving to new premises. The remaining transactions were predominantly lease renewals, reflecting limited availability in Prague’s prime office market.
According to Savills, the trend is linked to historically low levels of new office development. In 2025, just 26,600 sqm of office space was completed in Prague, representing the lowest annual delivery volume recorded in the market. A modest increase to approximately 36,700 sqm is expected in 2026, but this remains significantly below the 150,000–200,000 sqm of annual completions typically delivered during previous development cycles.
As new supply remains limited, vacancy rates in Prague’s key office districts have fallen below 5%, restricting options for companies seeking high-quality space.
Savills notes that relocation decisions are increasingly influenced by the costs associated with moving and fitting out new offices. While rental levels remain an important consideration, the investment required to relocate often encourages occupiers to commit to longer lease terms, typically ranging from eight to ten years. This can make relocation decisions more complex, particularly as companies face changing business requirements and evolving workplace strategies.
The market currently has 16 office projects under construction, representing approximately 312,900 sqm of space. However, a substantial portion of this pipeline will not be available to the wider leasing market. Six projects, accounting for around 54% of the total construction pipeline by floor area, are being developed for owner occupation.
Notable examples include the future headquarters of ČEZ, Erste Group and Creditas Group.
After excluding owner-occupied developments, approximately 108,800 sqm of office space remains available within projects currently under construction. Most of this supply is not expected to be delivered until 2028.
The shortage of modern office space is also contributing to rental growth. Prime office developments in central Prague are now targeting rents above €33 per sqm per month, while negotiations in selected projects are reportedly taking place at levels exceeding €35 per sqm per month.
Savills attributes this trend to a combination of rising construction and development costs and the limited availability of high-quality office buildings.
At the same time, the consultancy highlights a growing challenge within Prague’s existing office stock. More than 30% of the city’s office buildings are now over 20 years old, while refurbishment activity remains limited. Savills identified only seven major refurbishment projects currently planned, compared with 43 new development projects.
This creates increasing pressure on older properties, many of which face higher operating costs, lower energy efficiency and the need for future capital investment to remain competitive.
According to Savills, maintaining Prague’s attractiveness as a business location will require a combination of faster permitting procedures, renewed development activity and greater investment in the modernisation of existing office buildings.
Without additional supply entering the market and a broader programme of refurbishment, Prague’s office sector is likely to face continued upward pressure on rents and increasing competition for high-quality space in the coming years.
