Office Market: Modern City-Centre Locations Are Gaining, Older Buildings Are Losing Ground
The Swiss office market is becoming more selective: modern, well-connected city-centre locations with efficient fit-outs remain in demand, while older, less flexible buildings are increasingly coming under pressure.
In brief
The office market in Switzerland is becoming more divided: modern, flexible and centrally located office space remains in demand, while older buildings without refurbishment, weak energy performance or poor accessibility are feeling letting pressure. For owners, this means that quality, location, sustainability and usage flexibility increasingly determine rent levels, vacancy and value development.
What does polarisation in the Swiss office market mean?
Polarisation in the office market means that strong and weak office space are developing further apart. Modern, well-connected, energy-efficient and flexible spaces are in demand. Buildings that are technically outdated, generate high ancillary costs or no longer fit hybrid working models are finding it more difficult.
The trend affects not only rents, but also marketing time, investment needs, vacancy risk and property value. An office building in a central location is not automatically future-proof — the decisive factor is whether location, fit-out, floor plan and sustainability work together.
Why modern city-centre locations are gaining
Companies now use office space more strongly as a place for collaboration, exchange, client contact and employer attractiveness. This is why locations that are easily accessible for employees, offer an attractive environment and enable efficient space concepts are gaining ground.
Why older office buildings are coming under pressure
Location and accessibility
Central locations with good public transport, gastronomy, local amenities and an urban environment are more attractive to employees.
Energy and ESG
Energy efficiency, certifications and low operating costs are becoming more important for tenants, owners and investors.
Flexibility
Modern floor plans, plug-and-play fit-outs and flexible spaces help companies implement hybrid work more effectively.
Older buildings lose ground especially when several weaknesses come together: outdated building services, high energy costs, rigid floor plans, limited amenity value, difficult accessibility or uncertain refurbishment needs. Such properties often have to be marketed through lower rents, incentives or investment.
Modern city-centre location or older office building?
| Criterion | Modern city-centre location | Older building without refurbishment |
|---|---|---|
| Demand | Higher among companies focused on employees, client contact and employer attractiveness | Weaker when location, fit-out or energy efficiency no longer fit |
| Rent level | Can remain stable or rise when supply is scarce | Often under pressure due to vacancy, incentives or rent discounts |
| Operating costs | Efficient technology and better energy performance can reduce costs | Higher ancillary costs and refurbishment risks possible |
| Flexibility | Suitable for hybrid work, project zones, meeting areas and flexible use | Rigid floor plans make modern workplace concepts harder to implement |
| Investment needs | Often continuous optimisation rather than full refurbishment | Refurbishment, conversion or repositioning often necessary |
Step by step: How owners and tenants should respond
- Review local market data on vacancy, demand, rent levels and competing spaces.
- Analyse building quality honestly: location, technology, energy, floor plan, fit-out and ancillary costs.
- For older properties, assess refurbishment, partial modernisation, conversion or repositioning.
- Understand tenant needs: hybrid work, flexibility, plug-and-play, ESG and amenity quality.
- Carefully calculate lease structure, fit-out costs, incentives and reinstatement obligations.
- For companies, evaluate not only the rent per square metre, but total costs and productivity.
- For investments, calculate realistic scenarios for vacancy, lease duration, capex and reletting.
- Base decisions not on averages, but on micro-location and the specific quality of the property.
Assessment questions: Is an office space future-proof?
The following questions help owners, tenants and investors assess office space realistically in the current market.
Assessment questions for office space in the Swiss office market
1. Is the space easily accessible by public transport, bicycle and car?
2. Does the floor plan support hybrid work, team zones and quiet areas?
3. Are energy efficiency, ventilation, cooling and building services up to date?
4. How high are ancillary costs, fit-out costs and possible reinstatement obligations?
5. Are refurbishments required over the next 5 to 10 years?
6. Is the space attractive to several sectors and user groups?
7. How strong is the competition from modern spaces nearby?
8. Is conversion or partial modernisation economically viable?Practical examples
Example 1: Modern space in a central location
A company is looking for less total space than before, but wants an attractive location near a railway station, restaurants and client meetings. A modern city-centre space with good technology and a flexible fit-out is more expensive per square metre, but can be convincing through more efficient use and better employee acceptance.
Example 2: Older building in a peripheral location
An owner holds an older office building with high energy consumption and rigid floor plans. Despite a lower rent, spaces remain vacant. An analysis shows that partial modernisation, better space division and new positioning are necessary to become competitive again.
Checklist: Evaluating office space in the Swiss market
Frequently asked questions about the Swiss office market
Summary
The Swiss office market is becoming increasingly quality-driven. Modern city-centre locations benefit from accessibility, flexibility, energy efficiency and high amenity value. Older buildings, by contrast, lose attractiveness if they are technically outdated, poorly connected or no longer user-friendly. Owners should assess refurbishment or repositioning early, while tenants and investors should evaluate not only rents, but also total costs, contractual risks and long-term lettability.