Filtered by Subscriptions: Europe Commercial Property Use setting Europe Commercial Property
Emerging European property investment markets seem to have started 2013 brightly. Yet the sharp rise in region-wide investment volumes was in most part driven by a huge rise in activity in Russia. If economic growth expectations for Russia are revised …
11th April 2013
The currency driven boost to total returns in euro terms in Nordic and Swiss property markets seen over the past three years might have a little further to go. At some point, though, we would expect currencies in these countries to fall back. This could, …
9th April 2013
The combination of Q4’s 0.6%q/q fall in euro-zone GDP and the weakness of the latest activity data suggest that, in the short term, falls in region-wide logistics rents are more likely to accelerate than to ease off. And if we are right that the euro-zone …
5th April 2013
The latest survey evidence suggests that the French recession deepened in the first quarter. For now, while low economic sentiment seems to be dampening growth in French real estate equity prices, there is less evidence that direct property in Paris or …
4th April 2013
An increase in rent-free periods on typical office leases in some European markets helps to explain why headline rents have recently been less responsive to changing occupier demand conditions than might otherwise have been expected. These incentives will …
28th March 2013
Over the past year, the Polish retail market has moved from being one of Europe’s top performers for rental value growth, to one of the laggards. In the short term, factors such as falling residential prices, rising unemployment and sluggish real wage …
27th March 2013
As the Turkish economy has grown increasingly dependent on short-term capital inflows to finance its current account deficit, direct investment has fallen. But while this suggests that foreign investment demand for Turkish property may have fallen, …
21st March 2013
Data for the final quarter of 2012 show that the upward trend in Italian office and retail property yields paused. Yet both the current political impasse and the poor outlook for occupier demand, suggests that property yields are unlikely to settle at …
20th March 2013
In most European office markets, development pipelines have changed by little over the past year and have thus remained small. That should ensure that new supply this year does not unduly exacerbate the effect on office vacancy rates of falling occupier …
19th March 2013
After a difficult year, yesterday’s report of an uptick in Czech consumer spending is welcome news for retailers. But the outlook for spending is subdued, while the supply of new retail space is poised to rise this year. Thus, although the risks to our …
12th March 2013
In each of the previous two cycles, office rents rose much further in Madrid than Barcelona. But there is nothing to suggest that structural features of the Madrid market lie behind the more volatile rent data. So while talk of the next upswing still …
7th March 2013
Last week’s GDP data from Sweden were not as bad for commercial property as they might at first seem. Indeed, the detail suggests that occupier demand for each of the three main sectors may have risen in Q4. However, the sub-trend economic growth outlook …
4th March 2013
The relatively strong performance of Emerging European property markets in 2011 was not repeated in 2012. The softening economic backdrop did little to support rental growth, while yields appear to have stabilised. But conditions are no better in Western …
1st March 2013
Supported by a wider improvement in financial markets, investment demand for German commercial property surged in Q4 last year, despite the economy contracting sharply. But risk appetite looks to be waning again while, more fundamentally, Germany’s …
26th February 2013
The pace of economic contraction in the euro-zone stepped up a notch in the final quarter of 2012. Yet sentiment towards the region has improved. As a result, although the underlying drivers of commercial property occupier demand have deteriorated, for …
22nd February 2013
The outperformance of the Norwegian economy is evident in above-average growth in office and retail rental values, but not in initial yields. However, rather than being a sign that property in Oslo is undervalued, either in an absolute or relative sense, …
18th February 2013
Our forecasts envisage that European commercial property markets outside of the single currency region will benefit from the recent lull in the euro-crisis. Although the fundamental economic drivers of property have not improved materially since our …
14th February 2013
The current lull in the debt crisis has come too late to prevent a marked deterioration in economic and occupier market conditions in most euro-zone property markets. And the slowdown in economic growth already seen suggests that rental and capital values …
The recent strength of European real estate equity prices would be consistent, on past form, with increases in physical property capital values this year. But we think there are four reasons why it is far too early to move away from a bearish view on …
8th February 2013
The generally weak picture of European commercial property occupier markets portrayed by the latest RICS global survey is broadly consistent with our own views on the near-term prospects for rental values. However, while there is evidence to suggest that …
6th February 2013
The Russian economy cooled at the end of 2012, as we had expected, and growth is likely to remain lacklustre this year. However, although there are signs that the slowdown may be affecting the office market in Moscow more than we had anticipated, flat …
1st February 2013
Recent data show that the French economy is lagging behind Germany. If we are right that this divergence will grow, the low levels of property yields in Paris relative to Munich look unsustainable. Hence, it is plausible that within the next 18 months …
30th January 2013
The recent news flow from Poland suggests that the office supply pipeline in Warsaw is growing while occupier demand is softening. A sharp rise in the office vacancy rate now looks unavoidable this year. Given this, our forecast for Warsaw office rents to …
23rd January 2013
The strong rise in European property investment volumes in Q4 was driven by only a handful of markets and appears largely seasonal. It is unlikely to be a sign that an upwards trend is forming. … Has European property investment turned a …
22nd January 2013
Steeper falls in manufacturing output than in consumer spending in Spain help to explain the recent underperformance of Spanish manufacturing property rents relative to the logistics sector. And if we are right that Spain’s recession will deepen from …
17th January 2013
Over the past year or so, investors in Austrian property appear to have switched their preference from the office to the retail sector. Against an uncertain economic outlook, we expect this preference to persist, at least until most euro-zone economies …
15th January 2013
The results from this week’s EC survey suggest that, for most of Emerging Europe, commercial property occupier demand probably stagnated or deteriorated in the final quarter of last year. Hungary was an exception. But in common with many office, retail …
11th January 2013
This morning’s EC survey suggests that euro-zone commercial property markets ended 2012 on a low note. What’s more, past form suggests that the weakening in economic sentiment already seen is consistent with euro-zone all-property rents falling throughout …
8th January 2013
The surprising recent strength of the Danish consumer sector suggests that prime retail yields in Copenhagen may have peaked. But we think that retail occupier demand will suffer this year as, among other things, rising unemployment and falling house …
4th January 2013
Recent falls in Italian office rental values are likely to be extended next year. But with a 10% drop in public sector jobs in the pipeline, occupier demand and thus rents, are likely to fall further in Rome than Milan. … Will office rental values in …
20th December 2012
Given its relatively bright medium-term economic growth prospects, the outlook for Poland’s industrial occupier market over the next few years was already pretty decent. Over and above this, though, we think that the country’s ambitious road-building …
17th December 2012
Our forecast that 2012 European commercial property volumes would be as much as 20% lower than in 2011 looks to be on track. Unfortunately, the conditions are not in place for a rebound in 2013. If the euro-zone recession deepens as we expect, investment …
13th December 2012
The relatively strong rise in Helsinki retail rental values seen since 2010 is not difficult to square with the underlying health of the Finnish economy. But it is less straightforward to justify recent rises in Amsterdam retail rents. Nevertheless, we …
11th December 2012
Monday’s Central & Eastern European (CEE) manufacturing PMI data suggest that recent rises in industrial yields in Prague and Budapest might be one-offs. However, softer external demand from the euro-zone looks set to prompt falls in industrial production …
5th December 2012
Above-average falls in rental values and a rising yield gap with core markets both suggest that there is growing scope for commercial property in the peripheral euro-zone economies to outperform. Unfortunately, the drag exerted by the euro-zone crisis and …
4th December 2012
If the euro-zone crisis worsens and economic growth in Norway and Sweden disappoints, property yields in both Oslo and Stockholm are likely to rise by 30bps to 50bps over the next 12-18 months. Although our central forecasts do not envisage a marked shift …
30th November 2012
Outside the peripheral markets, the economic downturn in the euro-zone has yet to have a material impact on commercial property values. Yet if the recession deepens as we anticipate, the next six months should bring more widespread evidence that yields …
27th November 2012
We think that weak retail fundamentals in Belgium don’t warrant the currently low level of retail property yields in Brussels. Indeed, our forecast that consumer spending and retail rents are likely to fall suggests that investors’ required yields will …
22nd November 2012
Consistent with the slowdown in the region’s economies, the upturn in commercial property rents in Scandinavia seems to have stalled. Given that, we think that yields will begin to rise before long, and in turn property prices will soften. Elsewhere, the …
21st November 2012
In Q3, the euro-zone economy entered recession. For now, across the euro-zone as a whole commercial property rents and yields are pretty much flat. But if we are right that the region’s economic climate will deteriorate over the next 18 months, capital …
16th November 2012
At the margins, a case could be made that Turkey’s sovereign debt upgrade could boost investor sentiment towards all Turkish assets, including property. But, in 2013, given the prospect of tight credit conditions and weaker occupier demand, the upgrade …
12th November 2012
Recent data from RICS showing that occupier demand in France has been falling are consistent with figures showing that office and industrial take-up has weakened significantly. The data also look consistent with our forecast that, in 2013, French property …
9th November 2012
If we are right that the euro-zone economy will continue to weaken, the drag on economic activity in non-euro-zone European economies is likely to intensify. As a result, occupier markets in non-euro-zone economies will soften, meaning that rental values …
8th November 2012
The economic backdrop to euro-zone commercial property markets continues to deteriorate. Our forecasts, that all member states will experience some falls in economic output next year, appear to be on track. Recession will put downward pressure on rental …
Fresh signs of life in the consumer sector, together with relatively low retail property prices, seem to have prompted investor interest in the Romanian retail market. But the immediate outlook for consumer spending is weak and, although there is …
7th November 2012
Recent business surveys do nothing to undermine our forecast that Germany will lapse back into recession next year. Admittedly, that recession should be mild. But that is unlikely to prevent commercial property rental values from falling by up to 5% over …
1st November 2012
The results of this morning’s Q3 ECB Bank Lending Survey suggest that both occupier and investment demand for commercial property in the euro-zone is likely to weaken in the near term. And with many banks reportedly still keen to cut their exposure to the …
31st October 2012
To date, despite a sharp drop in investment volumes and growing evidence of a sharp slowdown in GDP growth, property yields in Moscow have not risen as we anticipated. But while a case can be made that yields in Moscow will remain resilient to the …
30th October 2012
The tone of both of today’s commercial property data releases was downbeat. Although the latest Bank of England survey showed that credit supply in the sector has improved slightly, borrowers are not rushing to take on new loans. Meanwhile, new commercial …
25th October 2012
Over the next year or so, we think retail rental values in Stockholm will remain flat. Indeed, although we don’t expect consumer spending to contract, growth is likely to be very subdued, especially compared to the rates seen in 2010 and 2011. What’s …
23rd October 2012
