Nicosia’s office property market remains stable in 2026, but it is becoming increasingly divided into two segments. Modern energy-efficient buildings are strengthening their position, while outdated offices are coming under growing pressure. According to Danos’ July report, companies now assess office space not only by size and location. Energy efficiency, parking, technical infrastructure and overall operating costs are becoming increasingly important.
Key tenant requirements include fibre-optic internet, ventilation, fire safety systems, controlled access, backup power, natural lighting and flexible layouts. Delivery access and the cost of renovation and fit-out are also taken into account. Offices that meet these requirements command higher rents. Older buildings increasingly compete through lower prices, but often require substantial upgrades.
Office prices in Nicosia are gradually rising
According to RICS/KPMG data cited in the Danos report, office property values increased by 2.91% year-on-year in the first quarter of 2026, while rental rates rose by 3.03%. Office property yields remained at around 5.6%. Experts describe the situation as gradual market growth rather than a sharp increase in the value of all office properties.
Nicosia remains Cyprus’ largest market for administrative and professional property. Of the 62 office transactions registered across the island in 2026, 33 took place in the capital. Their combined value amounted to around €11 million.
The average transaction value in Nicosia reached approximately €190,000. However, Danos stresses that this figure should not be used as a benchmark for large corporate headquarters, where factors such as floor area, number of parking spaces, operating costs, property documentation and rental income need to be assessed separately.
Modern offices can cost almost twice as much
The gap between high-quality and outdated properties is particularly visible in rental rates. Older and secondary-market offices are typically rented for around €12–16 per m² per month, while modern premises cost €18–25 per m². In Nicosia’s most prestigious business corridors, rents can reach €22–28 per m². A similar pattern can be seen in property values:
- secondary-market offices — around €2,000–€3,200 per m²;
- modern premium offices — €3,500–€5,000 per m².
Parking is becoming one of the most important factors. For companies with large numbers of employees, having enough parking spaces can sometimes be almost as important as the rental rate itself. A low rent does not always mean lower overall costs. Additional expenses for renovation, high energy consumption, inefficient layouts, off-site parking and difficult access can completely offset the difference in price. As a result, companies are increasingly evaluating the total cost of occupying an office, including incentives, landlord contributions to fit-out works and general operating expenses.
Which areas of Nicosia are in highest demand?
The capital’s office market is concentrated in four main business districts. The city centre and Makariou Avenue are attractive because of their prestigious location, proximity to government institutions and access to urban infrastructure. Their main disadvantages are limited parking and wide differences in the age and quality of buildings.
Limassol Avenue and the entrance to the city are becoming increasingly attractive thanks to modern corporate buildings, convenient motorway access and the availability of larger office spaces.
Athalassa–Dasoupolis is an established business corridor with good transport links, services and modern properties. Engomi–Griva Digeni remains an important corporate and educational district, although the quality of office stock varies considerably.
Meanwhile, the supply of modern office space is increasing thanks to projects such as Capital Gate, The Landmark Offices, NEXUS and City Gate Business Center. The market is also expected to gain additional supply from T-Capital and Nautilus Tower. However, new developments will not necessarily solve the shortage of large office spaces with sufficient parking immediately.
What lies ahead for Nicosia’s office market?
Danos expects rents for modern offices to continue rising moderately over the next 12–24 months. The outlook for older properties will be more mixed, with their competitiveness increasingly depending on the ability of owners to upgrade their buildings. Four main factors are expected to shape the market:
- the real cost of rent, taking into account incentives, fit-out costs and overall expenses;
- the availability of large office spaces with sufficient parking;
- the delivery timelines of new projects, including permits, financing, construction and certification;
- the ability of older buildings to improve energy efficiency and address parking shortages.
As a result, Nicosia’s office property market is not simply growing — it is becoming more selective. Companies are increasingly willing to pay more for office space that meets modern operational, energy-efficiency and infrastructure requirements.