Seoul office vacancy rates to remain low for the next two years

This is due to the absence of new supply in 2025.

According to a Savills report, Seoul’s prime office vacancy rate in December 2023, though slightly higher than the previous quarter, remains below the 5% natural vacancy level across the major districts. 

In Q2/2024, Meritz Fire & Marine Insurance HQ (CBD) and TP Tower (YBD) are scheduled for completion. Most office space in Meritz Fire & Marine Insurance HQ is expected to be occupied as headquarters, while its current building in YBD is scheduled for redevelopment starting in 2H/2024. 

Savills noted that most of the leasable area in TP Tower has been pre-leased, with major tenants such as Shinhan Securities, Kiwoom Securities and their affiliates set to relocate within the year. 

“Therefore, the vacancy rate is anticipated to remain low as upcoming projects have secured pre-commitments, while several existing offices will undergo demolition for redevelopment and renovation. Vacancy levels are expected to stay low for 1-2 years due to the absence of new supply in 2025,” the report said.

However, a significant increase in vacancy rates is projected to occur starting in late-2026, particularly with the introduction of large-scale offices in the CBD of projects such as Gongpyeong District 15 and 16, Supyo District, and Sewoon District.