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Helsinki offices to continue to outperform euro-zone

Following better-than-expected Q2 data, we have revised up our Helsinki office returns forecasts for this year. And given a robust rental outlook, returns are set to outpace the euro-zone over the next few years.
Yasemin Engin Property Economist
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More from European Commercial Property

Non-Euro European Commercial Property Chart Book

Scandinavia & Switzerland: Value gains set to slow

The recovery continued in the Scandinavian and Swiss economies and their property markets in Q1. It was a record first quarter for investment in Scandinavia. And annual capital value growth was robust for office and industrial, while retail values rebounded from their pandemic lows. However, pent-up demand from the pandemic will wane and the sharp rise in bond yields is already squeezing property valuations. As such, investment activity should slow over the course of the year, while we think property yields will reach their troughs.

24 May 2022

Non-Euro European Commercial Property Chart Book

Emerging Europe: Rental growth steps up

CEE economies and property markets started the year on a solid footing. Strong quarterly increases in office and industrial rents supported CEE all-property values in Q1, though yield compression slowed. However, rental growth is likely to drop back further ahead as economic growth decelerates, supply rises and structural changes take their toll. And we expect all-property yield compression to come to a halt, given increases in bond yields and signs of a shift in investor sentiment towards some CEE markets. As such, capital value growth is likely to slow sharply by year end. Property Drop-In (19th May): What will rising interest rates mean for commercial property returns in the US, UK and Europe? Join our 20-minute briefing on the outlook for returns on Thursday. Register now.

19 May 2022

Euro-zone Commercial Property Chart Book

Slower yield compression weighs on capital growth

Euro-zone commercial property values made further gains in Q1. Quarterly rental growth was strongest for industrial, though office and retail rents also rose. However, the pace of yield compression reduced, limiting capital value growth. And we expect this slowdown to continue, given the weaker economic outlook and expected rises in interest rates and bond yields, which mean property yields are likely to reach their trough this year. Property Drop-In (19th May): What will rising interest rates mean for commercial property returns in the US, UK and Europe? Join our 20-minute briefing on the outlook for returns on Thursday. Register now.

18 May 2022

More from Yasemin Engin

European Commercial Property Update

Investment past the worst but still faces uphill struggle

The Q2 data showed that pan-European (excl. UK) transactions improved after their Q1 lows. But international travel restrictions, structural shifts in the office and retail sectors and tougher credit conditions mean that the recovery in investment activity will be lukewarm.

29 July 2021

European Commercial Property Update

Prime Brussels offices to fare better than most

More remote working is pushing all occupiers to reassess their office space, but we think that rental growth for prime offices in Brussels should hold up better than the wider market.

22 July 2021

European Commercial Property Update

High construction costs unlikely to curb 2021 supply

With price pressures in the construction sector likely to prove transitory, we think that the hit to activity will be small. That said, we expect construction activity to slow over the coming years on account of lower office completions as the sector undergoes structural change.

14 July 2021
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