Baltic Office Outlook, 2026 Q2
Take-up is up, the pipeline is shrinking, and overall vacancy just fell to 8.4%. Yet the recovery is splitting the market in two: flexible, well-located buildings are filling up, while older and recently completed CBD stock still struggles to find tenants.
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The standout signal in this quarter's report is Vilnius: office vacancy dropped to 8.4%, down from 9.7% in Q1 — a meaningful shift after quarters of rising availability. The move was driven by real demand, not a supply pause: H1 2026 take-up hit ~81,900 sqm, up 63% year-on-year, while the development pipeline shrank to roughly half of last year's level (~65,300 sqm under construction).
But the market isn't uniformly recovering — it's polarising. Buildings offering flexible, divisible space in strong locations are absorbing demand quickly, while several recently completed CBD projects still carry substantial vacancy, and older, less competitive stock is under growing pressure to consider alternative uses.
The same divide is visible region-wide: Riga's tenants are optimising existing space rather than relocating amid a quiet development quarter, and Tallinn's stable vacancy masks a coming supply wave (~99,000 sqm in 2027) that's expected to sharpen competition for tenants, especially for outdated buildings.
The throughline: rents are steady everywhere, but building quality — not location alone — is now the deciding factor in who wins tenants and who gets left behind.