Property in Malta

Commercial Real Estate Market Review 2021

07.01.22 | Michael Paris

Commercial Real Estate Market Review 2021

Commercial Real Estate Market Review 2021

A look into the commercial real estate market in Malta over the last twelve months.

2021; was a challenging yet positive year for commercial real estate. QLC, your Commercial Real Estate Specialist in Malta, has put together a comprehensive overview of the salient trends of the past twelve months. From Offices to Shops and more, here's our analysis one property type after the other.

  • Offices
  • Warehouses
  • Retail
  • Catering
  • Guest Houses & Holiday Accommodation


The property type that was rented out the most in 2021, as it was in 2020, was offices (Class 4A). Apart from demand, this was also supported (and exceeded) by an increase in supply. A lot of brand-new offices came to the market with a lot more due to be finished in 2022. As a result, prices of offices decreased, especially in central areas, due to oversupply.

High-end offices, generally found in the East of Malta, around Sliema, St. Julians, Gzira areas have held up the prices when compared with the rest of the Maltese Islands. This year we noticed that many of our clients that were already set up in Malta, moved office space if the contract allowed it so that they would take advantage of the reduced rates following the effects of the pandemic. Offices amounted to just over 35% of our total transactions, which clearly shows that the demand for these types of properties is still thriving and remains an excellent investment. It will be interesting to see what happens in 2022.


Warehouses (Class 5) were the second most rented commercial properties in Malta by our commercial specialists and property agents, closing off the year at about 16% of all concluded lease agreements where QLC acted as brokers. Demand for large warehouses, which we class as being around 500sqmand over, surged dramatically at the back end of the pandemic. A trend we observed was that of business owners consolidating their multiple locations into central hubs for operations, storage, and distribution. In this case, warehouses are experiencing a totally different demand and supply scenario to that of offices and office blocks. As the increase in warehouse demand is relatively new to the market, supply has been struggling to keep up with it and consequently the prices per sqm per year of these properties has indeed increased throughout the last twelve to twenty-four months.


Although we did see a sharp decline in demand for retail outlets (Class 4B) in 2020 due to the uncertainty of the pandemic, we did see a slight recovery in the demand for retail outlets in 2021. This is probably to be credited to an increase in familiarity with the situation, the easing of restrictions in 2021 as well as intermarket movements. Retail spaces and showrooms on main arteries retained their value due to the restricted supply of these properties. Retail Outlets & Showrooms amounted to circa 14% of the total of all contracts closed by QLC Commercial Real Estate Specialists.


Restaurants & Takeaways, the hardest hit in 2020 (Class 4C & Class 4D), one of the hardest hit property types hit in 2020, have also somewhat recovered, closing off 2021 at just over 13% of total contracts. Following a period of uncertainty and challenges with staffing, the easing of measures in 2021 and the desire of the population to recover lost time eating out are contributing factors to this bounce-back. And with measures continuing to be eased, the demand is likely to grow. The cyclical nature of this part of the market also held up. Most of the contracts we closed were in the first six months of the year as most of the restaurateurs would be looking to rent places to be open for the summer season. 2022 should pose no surprises in this regard, especially knowing that if further measures are to be introduced, they are likely to be eased before summer. We are therefore expecting a high demand ahead of summer and an increased supply after that. Well-priced and well-positioned properties are expected to be rented out by the beginning of Q2, so if this is what you're after, we recommend getting in touch with us today.

Guesthouses & Holiday Accommodation

Properties like Guesthouses and Holiday accommodations were arguably hit the hardest by the pandemic. Although the demand is still faltering and cannot even start to be compared to pre-pandemic numbers, we have started to see a slight uptrend. This is shown through the results whereby this property type has seen a slight increase from 2% in 2020 to 4% last calendar year. We can see the two main contributors being that prices for such properties have been slashed, so more and more potential clients are willing to take the risk as it is mitigated. The second factor is that of the ‘Covid Clause’ that is now being entered into most commercial leases, whereby the rent will be decreased should the Government impose restrictions that render the business unable to operate.

Childcare Centres

Childcare centres or nurseries (Class 2C) are still extremely coveted properties to the restricted supply of such properties. That being said, should anyone have a groundfloor maisonette that is not situated on a main road, and has a adequate outdoor area, please get in touch with us on +356 7937 1629 or on [email protected] as we have many clients who are looking for a property with the coinciding class permit.


The same can be said for the properties that can be potentially used as gyms (Class 3C). There is a large demand for such properties but the supply of such properties is low due to the difficulty in acquiring the permit. Please get in touch with us on +356 7937 1629 or on [email protected] as we have many clients who are looking for a property with the coinciding class permit.