Relocate or Stay? How to Decide Before Your Office Lease Expires

The expiry of an office lease is an important decision point in the life of a company. Should the business remain in its current location, renegotiate the existing terms, or would it be better to look for a new office?

Based on Budapest office market data for 2026, many companies are choosing the first option. In the first half of 2026, lease renewals accounted for 53.3% of total leasing transaction volume, while the volume of new lease agreements fell by 49%.

However, this does not necessarily mean that staying is always the best decision. Rather, it indicates that more and more companies are carefully reassessing their real estate strategy before making a long-term commitment.

A lease renewal is actually a new negotiation opportunity

A common mistake is to treat the renewal of an existing office lease as a simple administrative process.

In reality, an approaching lease expiry creates an opportunity for the company to reassess its experience over the past few years:

• Is the office still the right size?
• Is the entire leased area actually being used?
• Does the building still meet employee expectations?
• Is the location still suitable?
• Are the current lease terms competitive?
• Does it still make sense to maintain the same amount of space for the coming years?

Due to hybrid working, changes in headcount and evolving expectations regarding the workplace environment, an office that was optimal five years ago may no longer provide the same value to the company today.

Before renewing, it is worth reviewing the market

At the end of the first half of 2026, Budapest’s modern office stock stood at approximately 4.47 million square metres, while the average vacancy rate was 12.2%. Within the speculative stock – office space available to market tenants – the vacancy rate was around 15.7%.

At first glance, this may suggest a significant level of choice.

However, not every vacant office represents a realistic alternative for a particular company. Once factors such as suitable size, location, technical standards, layout, parking, public transport access and required move-in date are taken into account, the number of genuinely relevant options can become much smaller.

For this reason, before renewing an existing lease, it is advisable to benchmark the market: what alternative offices are available, at what price and under what conditions?

Only then is it possible to determine whether the current landlord’s offer is genuinely competitive.

The monthly rent is not the only factor to compare

The cost of an office involves much more than the monthly rent per square metre.

When comparing alternatives, companies should also take into account:

• service charges,
• indexation,
• parking fees,
• rent-free periods,
• landlord contributions towards fit-out,
• potential relocation and fit-out costs,
• and the flexibility of the lease agreement.

An office that appears more expensive at first glance may ultimately offer a more favourable structure over the entire lease term. At the same time, a property offered at a lower headline rental rate may involve significant additional costs.

When can relocation be the right decision?

Cost reduction is not the only reason to consider moving to a new office.

Relocation may be justified if the company:

• expects its headcount to increase or decrease,
• wants a more modern working environment,
• requires better public transport connections,
• would prefer to move into a more energy-efficient building,
• wants to strengthen its employer brand through a new office,
• or finds that its current lease does not provide sufficient flexibility.

Especially in the case of larger space requirements, it is worth starting the search early. Although space is available across the market, finding modern, contiguous office space of the right size can become increasingly challenging for larger tenants.

When should the process begin?

Reviewing market opportunities should not be left until the final months before the existing lease expires.

Finding a new office, comparing suitable buildings, requesting proposals, negotiating terms, signing the lease, planning the space and completing the fit-out can all make the process relatively lengthy.

Moreover, understanding the available market alternatives is valuable even if the company ultimately decides to remain in its current office. The basis of a good lease renewal is the same as the basis of a successful office search: knowing exactly what the market has to offer.

Throughout this process, TCL supports companies that are searching for new office space or approaching a lease renewal. Our services range from defining requirements and identifying relevant office alternatives across Budapest to comparing proposals and negotiating lease terms.