Demand for office space across Africa is becoming increasingly focused on A-grade and ESG-compliant assets, driving a widening performance gap between prime and secondary office stock according to Knight Frank’s Africa Offices Market Dashboard H1 2025.

In more than half of the cities tracked, CBD office occupancy rates for high-grade office space reached record levels during H1 2025, surpassing 90% in some key nodes and underscoring the strength and depth of the ‘flight-to-quality- trend.

Currently, Cairo’s A-grade office space boasts a 90% average occupancy, buoyed by plug-and-play spaces that cater to multinationals and professional services. Similarly, Lagos’ Ikoyi submarket recorded a 7-percentage point increase in occupancy, from 84% in H2 2024 to 91% in H1 2025 as tenants migrated to higher-spec buildings.

The sustained demand for top-tier offices contrasts sharply with elevated vacancies in older or poorly located buildings where absorption remains ‘sluggish’.

In East Africa, performance remains mixed but relatively stable with the likes of Dar es Salaam recoding a 5-percentage point increase in occupancy, rising from 70% in H2 2024 to 75% in H1 2025, signalling an improvement amid a backdrop of subdued speculative development.

Conversely, Nairobi and Kampala are grappling with a looming oversupply of office space with Nairobi projected to receive approximately 15 000m² of new space by the end of 2025 and Kampala which is anticipated to add over 100 000m² of new A-grade stock.

Southern Africa’s cities reveal shifting dynamics as occupiers downsize and decentralise, according to the report. Lusaka, for example, where leasing activity in Q1 2025 was driven primarily by demand for smaller units (50m² to 250m²) and serviced office solutions, reflects occupier preference for flexibility and capital-light commitments. However, Q2 2025 saw a notable deceleration in enquiries and deal closures attributed to macroeconomic uncertainty and the return of substantial space to the market following the withdrawal of key institutional tenants and other organisations impacted by the US Government’s foreign policy changes.

Across the continent, hybrid work models are reshaping occupier requirements. While flexible working strategies offer productivity and talent access advantages, challenges such as limited digital infrastructure and varying cultural readiness persist. As occupiers reconfigure footprints, landlords are responding with agile leasing structures, fit-out allowances, and rent-free periods to remain competitive.

The long-term performance of Africa’s office market will hinge on asset quality, adaptability to occupier needs, and the ability to align with evolving work dynamics and sustainability benchmarks.

Country’s at a glance:

Botswana: Gaborone’s core commercial zones are experiencing a steady demand for A-grade stock with prime monthly office rentals at US$12 to US$13.70 per square metre and occupancy rates in the CBD stabilising at 85% to 95%. Tenants continue to favour modern buildings with energy-efficient systems, secure parking, and digital connectivity. In contrast, the B-grade segment remains under pressure, burdened by ageing building stock with occupancy rates having slipped below 75% and monthly rentals softening to US$6.5 to US$7.5 per square metre. To retain tenants, landlords in this tier are offering shorter lease terms, rent reductions, and modest refurbishments.

Egypt: Cairo is among the highest-rental office markets across the 29 African cities tracked by Knight Frank with the capital having emerged as the key hub for high-quality flexible offices, attracting major corporates and multinational firms. Flexible office operators are also actively expanding their footprints. With an average 90% occupancy rate for A-grade office space, prime office rentals registered a year-on-year increase of approximately 2.5% with the average asking rental rate now at US$37 per square metre, per month.

Kenya: Nairobi’s office sector is characterised by a dual demand trend; a sustained flight to quality among multinational tenants and a simultaneous push for affordability by local occupiers. Demand for A-grade office space remains strong, particularly for green-certified buildings with advanced infrastructure and ESG-aligned amenities. At the same time, B-grade offices are demonstrating a resilient performance, driven by cost-efficiency and appeal to domestic tenants seeking functionality over prestige. The office market continues to experience an oversupply oflower-grade stock with approximately 15 000m² of new space expected to be delivered by the end of 2025 which has contributed to a ‘wait and see’ approach among developers. Consequently, prime office rents have held steady at US$13 per month for four consecutive quarters.

Malawi: With A-grade office stock attracting monthly rents ranging from US$3.50 to US$8.50 per square metre, Malawi is positioned as one of the most competitively priced office leasing markets in Africa. Occupancy levels are currently between 60% and 85% with strong demand from financial institutions, non-governmental organisations, and regional corporates. However, macroeconomic headwinds have resulted in tenants adopting more cost-conscious strategies including downsizing or relocating to more affordable B-grade assets which often fall short of meeting modern occupier expectations.

Nigeria: Lagos’ office market recorded a notable improvement in occupancy rates across key prime submarkets, driven by steady demand for A-grade office space. Overall occupancy levels improved from 65% to 73% year-on-year, reflecting increased absorption of newly delivered A-grade stock, particularly in Ikoyi and Ikeja. In Ikoyi, average A-grade monthly rents declined 3.5% year-on-year, softening to US$57 to US$55 per square metre.

Tanzania: A-grade office space in Dar-Es-Salaam remains characterized by a moderate but stable demand with overall occupancy levels reaching 75%, up from 71% in H2 2024 – largely driven by landlord-led strategies aimed at retaining tenants including flexible lease terms, rent concessions, and aggressive negotiations. Despite these interventions, headline rents have remained constant at approximately US$15 per square metre, per month, over the past year. The market continues to grapple with elevated vacancy rates in B-grade and older stock, while quality, well-located properties retain a competitive edge.

Uganda: Kampala’s office market remains tenant-led with occupiers prioritising flexible, efficient, and tech-enabled workspaces. Prime A-grade office space in core CBD locations continued to attract strong demand, commanding average monthly rents of US$16.50 per square metre with B-grade office stock following closely with rents averaging US$15 per square metre. Newly delivered A-grade stock achieved premium rental rates of between US$18 and US$22 per square metre.

Zambia: Lusaka’s office market is currently in a consolidation phase with landlords and occupiers adopting a cautious, strategy-driven approach to leasing decisions. Lease negotiations are increasingly factoring in Kwacha depreciation, rent-free periods, tenant fit-out contributions, operating cost structures, and annual escalation clauses. Q1 2025 witnessed moderate leasing activity, primarily driven by demand for smaller units (50m² –250m²) and the expanding serviced office segment. However, Q2 saw a notable slowdown in both enquiries and transactional volume, partly due to market uncertainty.

Zimbabwe: Harare’s office market is undergoing a structural transformation as occupiers continue to migrate from the CBD to suburban nodes, driving year-on-year rental growth of approximately 20% in suburban locations with average rates now ranging between US$8 to US$10 per square metre, per month, compared to US$5 to US$7 per square metres in the CBD. The shift is driven by the demand for a less congested, more accessible environment and the repurposing of residential properties into small-sized office spaces, which is expanding suburban stock. Elsewhere, suburban office yields are averaging around 9%, while CBD assets trail at 6%.