The office property market in Thessaloniki is being driven by demand for modern, energy-efficient workspaces, according to a market report. While the city has seen increased activity from technology companies and multinational firms, particularly in outsourcing and professional services, the availability of suitable high-quality office space remains limited.
Demand appears to be concentrated in central areas and near major transport hubs. The report by Danos, an alliance member of BNP Paribas Real Estate, describes a divided market: older, lower-quality office spaces show weak demand and often remain vacant, while modern, high-specification (Grade A) offices face strong demand and very limited availability, with vacancy rates below 5%.
This imbalance between supply and demand is a key factor behind a shift towards new developments and extensive renovations. In some cases, companies are consolidating fragmented older spaces into larger, open-plan modern offices. The report also presents the adoption of ESG (Environmental, Social, Governance) standards as a catalyst for upgrading the existing building stock, thereby increasing demand for newly built or fully refurbished properties.
Property owners are generally reluctant to sell office assets despite strong demand. Yields for Grade A offices are currently estimated at 7.25% to 7.50%. This suggests a high level of confidence in the real estate market's long-term growth prospects.
Rental prices for high-specification offices range between €15 and €17 per square metre, reflecting upward pressure linked to limited supply, with annual increases estimated at 4.5%. By contrast, older office spaces average around €10.5 per square metre. At the same time, the growing adoption of flexible working models has supported the expansion of co-working spaces, which are often developed through the refurbishment of older properties in central areas.
Looking ahead, prospects for 2026 remain positive, with two main trends visible: continued rental growth and the gradual activation of new developments. Prime office rents are expected to rise by a further 3.5% to 5%, particularly in central and well-connected areas, while yields are projected to stabilise at around 7%. Investment activity is also expected to strengthen as new projects enter the market.
by Lina Tsireka - adapted from Greek by Vassia Barba
