Strong demand for prime offices and a resilient retail sector is underpinning optimism about the year ahead. We asked the Savills global network of experts for their expectations of the outlook for occupiers. An average of 69% expect rents to rise in 2026, driven by increased demand and rental growth across all major property sectors. Grade B offices are the exception as they continue to face pressure.
Prime office rental prospects to strengthen further
Positive momentum in prime office is set to continue into 2026, with 89% of our survey respondents forecasting rising prime rents and two-thirds expecting them to increase by more than 2%. Furthermore, 82% expect take-up will strengthen as corporates maintain their strategy of consolidating into fewer, but higher-quality, spaces.
This represents an improvement on last year’s sentiment. In our 2025 outlook, 81% of respondents forecasted increasing rents in their respective markets – projections that are in line with actual performance to date based on Savills Prime Office Costs data.
Prime office rents outlook, historical comparison
Source: Savills Research
In Asia Pacific, the fastest prime office rental growth is anticipated in talent hubs such as India, Vietnam and Malaysia. Multinationals are expanding in these markets to access cost-efficient skilled labour, including through increasing use of global capability centres. Elsewhere, Tokyo is expected to see rental growth of more than 5%, driven by supply scarcity and low vacancy rates of around 1.5%.
In EMEA, prime office rents are forecast to rise in more than 90% of the markets we track in our survey. In London, tight supply of prime stock and fierce competition for high-spec, sustainable offices will drive strong increases. Dubai is expected to see continued growth, albeit at a moderated pace following sharp rises in 2025. Meanwhile, Riyadh recently introduced a five-year rent freeze on residential and corporate properties.
Several US markets forecast prime rent rises between 2% and 5%, reflecting strengthening work-from-office mandates, as well as tenants leasing higher-quality space. Dallas-Fort Worth and Miami expect rental increases due to employment growth, high office utilisation, limited prime office supply and continued flight-to-quality trends. Major tech hubs – such as the San Francisco Bay Area, New York and Seattle – are expected to see increasing prime office demand driven by the AI sector.
Against this backdrop, Grade B offices in many business hubs are struggling to attract tenants and justify rental growth. However, markets facing supply constraints and low vacancy rates – including Tokyo, Islamabad and Mexico City – show potential for increased take-up and increases in rents.
Flexible office operators will be a major contributor to office letting activity in 2026. The AI sector will also be a key driver of demand, though its rapid expansion introduces potential future volatility. Meanwhile, the legal, financial and life sciences sectors continue to provide a stable base of leasing activity across many cities.
Office occupier demand, by sector
Source: Savills Research
Selected retail markets forecast strong rent rises
Physical retail is proving resilient. Two-thirds of our survey respondents anticipate rental growth in the year ahead, with 26% forecasting stable rents and just 9% expecting declines. This marks a shift from previous years – in 2024, half of respondents projected rising rents and almost one in five foresaw decreases.
In Asia Pacific, India, Malaysia and Vietnam are expected to see robust retail rent rises and improved take-up. These markets benefit from rapidly increasing consumer affluence, growing tourism and an influx of international brands. In addition, supply of high-quality retail space has not kept pace with demand, pushing vacancy rates down and driving competition.
Prime retail rents in Australia are also expected to rise strongly due to high occupancy rates, low vacancy levels and retailers competing for prime locations. A growing demand for experiential retail, the rise of mixed-use developments and improved consumer spending power from wage growth are also contributing factors.
European rental growth is expected to be more robust on prime high streets, which continue to attract prestigious brands. Many of these are exploring new formats that blur the line between retail and food and beverage, focusing on quality, leisure and experience. Major cities in continental Europe, such as Madrid and Amsterdam, are also poised for further growth, supported by resilient consumer spending and constrained development pipelines.
US sentiment is largely neutral, with stabilised retail rents and take-up forecast for 2026. Several global brands are expected to moderate their US expansion plans in response to geopolitical uncertainty, shifting their focus in the North American market to Canada.
A largely positive picture for residential sectors
What about the residential rental market? The majority of respondents to our survey expect continued prime rental growth (82%) and increased demand (78%) from private individuals next year, with positive sentiment forecast across most markets.
India is set to record some of the strongest residential rental increases next year due to rapid urban population growth, a shortage of affordable housing and new premium properties coming to market to serve prime demand. Strong rent rises are also anticipated in Portugal, where markets such as Lisbon and the Algarve attract digital nomads.
For multifamily, senior living and student accommodation, 78% of respondents forecast rental growth next year, with 71% expecting take-up to improve.
Industrial and logistics occupiers focus on resilience
In the industrial and logistics sector, occupier strategies continue to be shaped by supply-chain realignment and geopolitical uncertainty, as well as e-commerce expansion. Building resilience and flexibility into supply chains is a priority.
Rental growth is expected across the majority of markets, excluding Mainland China, Hong Kong and Singapore. Almost two-thirds of our survey respondents predict rent rises, although 27% forecast no change to rents. Notably, 79% expect increased take-up in their markets, meaning they anticipate growth in letting activity will outperform rental growth.
The UAE is expected to continue to outperform, with increases in both rents and take-up in 2026. This will be driven by limited availability of prime industrial and logistics spaces, a high average occupancy rate of 95% for Grade A stock and pre-leasing of new supply.
