The situation in the office market remains the most challenging among all commercial real estate segments. Over the years of the war, vacancy rates in business centers have risen and rental rates have fallen. However, new tenants of professional office space are still expected to enter the market.

Russia’s invasion of Ukraine and the outbreak of hostilities, the global COVID-19 pandemic, and lockdowns have led to a decline in revenue for most companies, while their obligations to counterparties, payroll expenses, tax payments, and other costs remain unchanged. Given the rising cost of energy, higher utility bills (the need for generators, power outages and lost working hours due to alerts), and the resulting increase in OPEX [due to rising vacancy rates and the distribution of operating costs among fewer tenants], the burden on tenants has increased, while rental rates have been declining. According to analysts at UTG, in June 2026, the rent per square meter was $19.5 for Class A, $11.6 for Class B, and $9.5 for Class C (excluding VAT, OPEX, utility bills, and BOMA fees). At the same time, the weighted average vacancy rate in Kyiv’s business centers as of mid-2026 was: Class A = 24.3%, Class B = 18.9%, and Class C = 14.4%.

There was also a shift in tenant types, a reduction in leased space, and a move to areas farther from the city center. Ukraine’s largest corporations transferred employees from leased premises to their own office buildings. A number of companies closed underutilized corporate offices, while small and medium-sized businesses streamlined their expenses. The widespread practice of working from home, which began during the COVID-19 pandemic, has intensified due to the threat of mobilization and the situation facing employees of the TRC (territorial recruitment centers).

If we analyze office space tenants, Ukraine has now become a veritable testing ground for know-how and advanced modern weapons systems, and global giants in the defense industry are launching or negotiating the opening of joint production facilities, factories, research and development centers, and administrative and office representative offices in the country. Among these potential tenants are companies from countries such as Germany (Rheinmetall, KMW), Turkey (Baykar), Norway (Kongsberg), Latvia (Atlas Aerospace), the United Kingdom (BAE Systems), the United States (Northrop Grumman), Denmark, France, Italy, Spain, Poland, and many others. All of them are actively involved in the negotiation process and are opening local offices and creating new jobs.