• In Lisbon, the total absorption volume in the first half of 2024 (127,645 sq m) more than tripled when compared to the same period in 2023 (37,917 sq m).
• By the end of the year, an additional 50,000 sq m of office space is expected to be placed in Lisbon
• In Porto, the absorption volume in the first half of 2024 was 28,375 sq m, a 13% increase when compared to the same period last year.
• In the first half of the year, there was an 82% year-on-year increase in the total gross leasable area occupied by new companies in the Porto office market.

Lisbon

In the first half of the year, Lisbon recorded a total absorption volume of 127,645 sq m, a figure that more than tripled the 37,917 sq m from the same period in 2023 and is 40% above the average take-up for the first halves of the past five years.

A total of 82 transactions were completed during this period, representing a 15% increase when compared to the same period in 2023. The five largest transactions accounted for 55% of the total absorption volume for the semester, including Caixa Geral de Depósitos move into the WellBe building with 26,709 sq m and the European University’s occupancy at Oriente Green Campus with 15,835 sq m. There were 18 transactions above 1,500 sq m, representing 22% of the deals closed in the first half of 2024.

The Parque das Nações area, with 50,133 sq m, and the New Office Zone, with 28,172 sq m, were prominent, together accounting for 61% of the total absorption volume.

The financial sector was responsible for 39% of the closed transactions, and the TMT & Utilities sector for 18%.

Flexible workspaces continue to assert themselves as a trend, with demand increasing gradually and continuously. In the first six months of the year, flexible spaces represented 7% of the total absorption volume.

Four projects were completed in the first six months of 2024, adding nearly 45,000 sq m of new office space to the stock. These included the EDP 2 building with 11,400 sq m in the Historic & Riverside Zone, and the EXEO in Parque das Nações with 21,474 sq m, fully occupied by BNP Paribas.

Frederico Leitão de Sousa, Head of Offices at Savills Portugal, stated: “The first half of 2024 proved the strong attractiveness of our market. While the end of 2023 saw somewhat timid and cautious forecasts, the results achieved by the end of this semester show that the Lisbon office market enjoys a very active demand, leaving no doubt that the trend is growth. However, it is also crucial that investment in new quality projects continues to effectively and promptly meet the high standards of demand.”

Porto

In Porto, the office market recorded a total absorption volume of 28,375 sq m in the first half of the year, reflecting a 13% increase when compared to the same period in 2023.

Notably, there was a significant increase in new companies choosing Porto as the headquarters for their operations. In the first half of the year, there was an 82% year-on-year increase in the total gross leasable area (GLA) occupied by new companies.

A total of 42 transactions were completed during this period, representing a 31% increase compared to the previous year, with 10 transactions exceeding 1,000 sq m.

The Matosinhos area, accounting for 36% of the total absorption volume, recorded the highest absorption volume in the period under review with a total of 10,327 sq m, followed by the CBD Boavista area with a total absorption volume of 9,779 sq m.

Companies in the Technology, Media & Telecom sectors played a prominent role in the Porto office market, representing 45% of the absorption volume in the period under review, reflecting a 75% growth in occupied GLA. Meanwhile, the prime rent remained stable at €19/sq m/month.

From January to June, more than 26,000 sq m of new office space were completed in Porto, including the Noto Office Center, the Ariane, and the Pharmácia building. The projects expected to be completed by the end of 2024 will add a slightly higher GLA of over 25,000 m², with a guaranteed occupancy of 71%.

Graça Ribeiro da Cunha, Offices Associate at Savills Portugal | Porto Division, emphasized: “The figures recorded in the Porto office market in this first half of the year are very encouraging and show that companies are increasingly looking to the north of the country to establish their operations. It is noteworthy the number of technology and telecommunications companies that have chosen Porto to continue their activities, indicating that the city offers important fundamental resources such as a qualified workforce, infrastructure, communication routes, and more, making it extremely attractive for business development.”