The Greater Paris Region, with a total stock of 52 million sqm of offices, is the 3rd largest office market in the world after Tokyo and New-York. It’s also one of the highly transparent and organised real-estate markets in the world.
The Greater Paris Region has the biggest GDP in Europe and is also the first European market in terms of size of its stock or leasing activity (with on average 2.3 million m² take-up annually). It’s also the second biggest investment market in Europe.
The Greater Paris market has built its attractiveness on its maturity, liquidity and diversity. Paris concentrates the highest ratio of large firms from a wide range of economic sectors; it offers a large choice of offices and a very dense public transport network. This liquidity and maturity is also found in the investment market, making Paris a highly sought-after destination for cross-border investment.
The Grand Paris project will have a direct impact on the elements at the very core of office market dynamics: transport and economic development.
Employee access to companies, proximity to economic partners, links with other office centres are all elements that contribute to the attractiveness of office markets – and are all elements that will be affected by the Grand Paris project.
The opening of new metro lines between 2017 and 2030 will shorten journey times to certain areas and open up others or will create new, direct routes. The 7 Clusters, identified by Territorial Development Contracts (CDT) will reinforce existing or emerging economic centres. In particular, this strategy includes the development of suitable real estate supply by renovating existing stock or by creating new supply. The potential is considerable as the scale of projects dedicated to economic activity that have already been announced is equivalent to more space than is currently in the La Défense market as a whole.
These elements, linked to others such as demographics or working practices, will gradually shape the new office landscape of the Greater Paris Region; a landscape which will steadily be transformed as and when new transport lines are developed or completed and as the competitiveness centres gain momentum.
Grand Paris raises a number of questions which will be opportunities for both businesses and investors over the coming years: the choice of location to move to or to invest in, the type of product to develop and over what timeframe. It also raises the question of the emergence of new office centres and whether existing markets will be strengthened or weakened by the development of new competition.
Will the office market in 2030 see the emergence of a new La Défense in the Greater Paris Region? Which markets are best placed to benefit most from the Grand Paris project? Which markets are at risk? Will opening a new Grand Paris Express station necessarily lead to the development of an office market or is it more likely to lead to the development of highly localised supply to meet the new needs of commuters? Will Grand Paris and the Grand Paris Express reduce or emphasise existing disparities between economic and residential areas?
Future research by JLL will consider these questions and present various scenarios for the office market over the years to come.