Tallinn Office Outlook, 2025 H1 -

Tallinn Office Market Outlook 2025 H1

The Tallinn office market remained stable but segmented in the first half of 2025, as the city continued its gradual recovery amid elevated vacancy levels, cautious demand, and a slowing development pipeline. While prime A-class offices continue to perform well, B-class landlords face intensifying competition and slower absorption.

In Tallinn overall office vacancy held at 8.2%, with A-class performing stronger at 7.3% and B-class rising toward 8.6%. Despite healthy demand for modern, well-located offices, the mid-tier segment is seeing increased challenges as an additional 15,000 sqm of B-class space is expected to enter the market this year.

New supply remained moderate: approximately 33,000 sqm was delivered in H1 2025, including major projects such as the new Wise headquarters and the Golden Gate building. A further 10,000 sqm is expected by year-end, marking a notable slowdown from 2024 levels. Still, the longer-term pipeline remains steady, with nearly 90,000 sqm under construction, including flagship schemes such as Hipodroomi Quarter and Talsinki.

Rental levels remained stable, supported by continued demand for A-class space. Prime offices command €17.3–24.0/sqm/month, with the best CBD locations reaching €27.0/sqm. B-class rents range from €11.8–15.8/sqm, but landlords in this segment are increasingly offering incentives such as rent-free periods, shorter lease terms, and fit-out support to maintain occupancy.

The Tallinn market in H1 2025 is characterised by steady activity, selective demand, and heightened competition among developers and landlords. The next 12 months are expected to bring gradual recovery, with the strongest performance concentrated in prime, sustainable, and future-ready offices.