Occupational trends in the Italian office leasing market by sector

• Alignment with European sector trends. Italy's office leasing market closely follows European patterns, with technology, banking & finance and professional services driving demand, representing over 60% of 2024 take-up volumes, in Milan and Rome.


• Sector-specific location patterns emerge. Distinct geographic preferences reveal strategic decision-making across industries with legal and banking & finance firms concentrating in prestigious central districts, professional services distributing citywide, and manufacturing operations strategically selecting cost-effective peripheral locations, revealing how location decisions align with core business requirements and client-facing needs.


• Milan and Rome reveal complementary market dynamics. Italy's two major office markets reflect their different economic roles in take up trends. Milan, as the country's economic capital, shows stronger demand from business sectors (Professional Services, Banking & Finance, Technology) driving 60% of take-up. Rome's market, by virtue of its status as the capital city, is significantly shaped by Public Administration, which concentrates 67% of its CBD activity near government institutions.


• Innovation districts fuel specialized demand. Milan's evolving urban landscape features emerging specialized clusters in the life science sector. This cross-sector industry is driving market transformation with strategic footprint expansion across multiple districts. Pharmaceutical companies lead this, establishing clusters in some peripheral areas while also securing high-value representation spaces in central locations.

The office leasing market in Italy's two principal cities, Milan and Rome, demonstrates interesting dynamics that partly reflect European trends. Analysing the last years (2017-2024), there is alignment between leading sectors in Europe and Italy. Across Europe, the three best-performing sectors in terms of leased space have been banking & finance, professional services, technology. Italy (considering Milan and Rome combined) follows this trend with a slight variation: technology maintains the lead, with a higher market share, followed by banking & finance and professional services.

In 2024, this trend further consolidated: in Italy, these three sectors, together with Public Administration (traditionally more prominent in Rome but also significant in Milan following a single 15,000 sqm transaction), represented over 60% of the total take-up volume. This concentration highlights not only continuity with past trends but also the resilience of these sectors despite the challenging global economic context.

Looking more closely at the Milan market over the past two years (2023-Q1 2025), clear locational preferences emerge for different business sectors. CBD Duomo and CBD Porta Nuova areas remain attractive hubs for tenants operating in IT, banking/financial services, and legal firms. The choice of these areas is motivated by their centrality and prestige.

For legal firms specifically, both in 2024 and the first quarter of 2025, over 90% of the total transacted space was concentrated in these central areas, with an average size under 500 sqm. Proximity to headquarters of major companies and financial institutions allows greater client accessibility, facilitating interactions and reducing travel times.

The average size of spaces leased by legal firms in 2024 was less than 500 sqm, a relatively contained dimension reflecting both the specific operational needs of these professionals and constraints imposed by high rents in central locations.

MILAN Take-up legal firms - 2023-Q1 2025

^{Source – Jll Research}

The professional services sector shows a more homogeneous distribution throughout Milan's urban area, indicating greater locational flexibility among these operators. In contrast, the manufacturing/industrial sector is mostly concentrated in Milan's hinterland, particularly in San Donato following a significant transaction of approximately 40,000 sqm. In this macro-area, the availability of larger spaces at lower rents represents a determining factor in location choice.

Particularly interesting is the evolution of the Life Science segment, a cross-sector field encompassing various industries. In 2024, this segment recorded a take-up of just over 30,000 sqm, representing 8% of total take-up, significantly higher than the average of the last ten years (approximately 20,000 sqm). This data demonstrates the growing dynamism of a sector gaining increasing relevance in the market.

In terms of geographical distribution, in 2024, Milan's hinterland registered half of the total Life Science take-up (15,200 sqm), with particular concentration in the Segrate and Milanofiori areas. Another area of strong interest, although no recent transactions have been recorded, is MIND (Milan Innovation District), an emerging hub for innovation and scientific research. MIND, developed in the area that hosted Expo 2015, represents a strategic project for Milan, destined to become an integrated ecosystem for research, innovation, and education, capable of attracting companies and talent from the Life Science sector and beyond.

The periphery recorded a take-up of 11,500 sqm, with a particular concentration in the Bicocca area, a university and research hub, which historically has been one of the peripheral areas with the highest concentration of transacted space.

MILAN - Life science take-up - 2023-Q1 2025

^{Source – Jll Research}

Within the life science segment, the pharmaceutical sector stands out for its predominant weight, representing, in 2024, 47% of the total take-up in this sector.

Regarding the dimensions of leased spaces, life science shows a certain diversification: while areas under 1,000 sqm prevail, several operations involved medium-sized spaces between 2,000 and 5,000 sqm. Regarding location, although most were in peripheral areas and the hinterland, some tenants have strategically selected representation spaces in prestigious central areas such as Porta Nuova. In this market, primarily dedicated to corporate functions rather than research and development, companies have demonstrated willingness to pay prime zone rates in the last year and a half.

Occupier demand in Rome is predominantly concentrated in the CBD and EUR districts. In the latter, however, demand exhibits greater fragmentation due to two key factors: firstly, the significantly larger amount of available commercial space, and secondly, the division of the area into multiple submarkets (EUR Core, EUR Laurentina, EUR Torrino, etc.), resulting in an even more widespread distribution of requirements across the sector.

The Italian capital's office leasing market reveals a clear geographic hierarchy shaped by governmental presence that differentiates it from Milan's more commercially oriented environment. Since decision-making processes of public entities naturally follow different timelines compared to private sector transactions, we see a distinctive rhythm in the capital's real estate absorption, characterized by cyclical peaks of activity. Public Administration dominates CBD activity, concentrating its leasing volume in central districts to maintain operational synergies with government entities and optimize administrative processes.

Legal firms similarly prioritize central locations, mirroring the prestige-driven location strategies observed in Milan. Meanwhile, IT and Manufacturing/Industrial sectors demonstrate strong preference for the E.U.R. district, which offers a balance of accessibility and more favourable space economics. Unlike Milan's more defined clustering tendencies, Rome's Banking/Financial and Professional Services sectors display more balanced distribution across both central and E.U.R. districts, revealing more diversified location strategies that accommodate the city's dual function as both business and governmental centre—a distinctive feature of Rome's occupier market dynamics.

ROME - Legal firms take-up - 2023-Q1 2025

^{Source – Jll Research}

ROME - IT take-up - 2023-Q1 2025

^{Source – Jll Research}

The analysis of occupational trends in the office markets of Milan and Rome reveals impacts on market dynamics. Sectoral concentration in specific areas is effectively exerting upward pressure on rental rates, particularly evident in the central areas of both cities. In Milan, the CBD (with a prime rent of €740/sqm/year) and especially Porta Nuova Business District (with a prime rent of €720/sqm/year) are experiencing a constant increase in rents, fueled by strong demand from the banking & finance and legal sectors which, as highlighted in the analysis, show a marked preference for these areas (with over 90% of the legal sector take-up concentrated in these zones in 2024 alone).

In Milan, this concentration toward prime locations has led to a decrease in vacancy rates in central areas, although it should be noted that the city responds to this pressure thanks to the greater availability of new Grade A product compared to Rome, allowing a partial rebalancing of the market through quality developments.

On the other hand, in Rome, the location strategy of certain sectors such as public administration and legal firms in the CBD or manufacturing and IT in the EUR zone has contributed to rising rents in these areas, although the main reason for the increase in rents is due to an imbalance between demand and supply of quality products.