Real estate experts sound alarm as supply of office space outweighs demand

Real estate experts and business leaders sounded the alarm after highlighting that the supply of office space in Malta is surpassing the current demand. 

The experts noted a growing trend where the supply of new office spaces continues to increase while the demand for these commercial properties is experiencing a slowdown. 

This was discussed during a panel event featuring leading real estate experts. The consensus among the panellists was that it is time to reassess the commercial property market in response to shifting dynamics.

The panellists identified unique features and “tenant experiences” as key factors that distinguish sought-after properties from the rest. Properties offering distinctive features are likely to be winners, while those falling on the lower end of the spectrum, particularly those with issues like parking and access limitations, face challenges.

Hosted by the Malta Business Network, the event facilitated discussions on various aspects, including the current state of the office market in Malta, and the future of the 40-hour workweek. Here, the growing desire of employees to work from home was also noted.

The flexibility of remote work options has become a sought-after perk for employees, emphasising the need for employers to align workplace strategies with these evolving dynamics.

Panellists noted that in 2023, the real estate market in Malta grappled with inflationary pressures, rising interest rates, and the evolving landscape of hybrid work arrangements. 

The panel highlighted challenges such as the lack of transparency in accessing market data related to yields and transacted rates.

Panellists noted that although third country nationals have increased significantly in Malta along with the number of expats, many of them do not work desk jobs. 

The discussion emphasised how office environments significantly influence company culture and the lifestyle they aim to promote, ultimately impacting employee engagement and satisfaction.

The event concluded with insights into Malta's potential to attract digital nomads, recognizing the need for the country to tap into this sector of fully remote workers who move between locations while staying digitally connected.