Prague’s office market is stuck in a squeeze. Rents are hitting €35 per square meter, fit-out costs now equal five to seven years of rent, and just 26,000 sqm of new space is coming online in 2026. That used to be a single quarter’s delivery before COVID. Tenants who don’t reserve space through pre-leases are less and less likely to find the type (and size) of space they really want.
As Pavel Novak (Head of Office Agency at Savills Prague) told me more than 55% of Prague’s office stock was built before 2010. And only 12% of the market has been built since 2020.
“You have more than 200 buildings that are more than 20 years old,” he told me on ThePrime Pod. “I think that’s a bigger issue right now than the lack of new development. That’s just some of the background to the current situation, in which new lease deals are longer than ever and renewals dominate new leasing.
Companies face a brutal choice between costly relocations and ageing space — and some global occupiers are starting to ask whether Prague still makes sense at all. The situation plays into the hands of real estate investors interested in a sector with a miniscule amount of new stock. But it’s not helping build Prague as a dynamically growing place to do business.
