Urban retail rents in Germany rise by 6% in 2025

Rents in urban retail across the 16 major German cities rose by an average of 6.0% in 2025 (6.4% in A7 cities), according to a study by the German Economic Institute (IW).

Europa Passage, Hamburg

This growth significantly outpaced the general inflation rate of approximately 2.3%, compensating for weaker performance in previous years.
While prime downtown locations still command an average 60% price premium over typical urban areas, this premium decreased from 69% to 52% between 2018 and 2025. However, retail directly on main shopping streets (especially in A7 cities) mitigated this decline. This suggests a recovery in city centre retail, but with increased concentration in highly central spots.
Munich (+10.2%) and Düsseldorf (+9.5%) saw particularly high rent increases across their entire urban areas. City centres in Dortmund (+16.3%), Bremen (+12.8%), and Munich (+12.0%) also experienced significant jumps. However, year-on-year comparisons for specific locations should be viewed cautiously due to higher volatility and less data.
Annual rent increases for the period 2018-2026 ranged from 2% to 4% across both urban areas and city centres. Bremen showed the strongest medium-term growth (+4.7% annually), while Stuttgart had the weakest (+1.8% urban, +0.4% city centre). Despite its slower growth, Stuttgart remains the second most expensive city centre after Munich based on median rents.
The findings indicate a current upward trend for brick-and-mortar retail, driven by a market correction (fewer advertisements) and less dynamic growth in online retail.