Filtered by Subscriptions: Europe Commercial Property Use setting Europe Commercial Property
Switzerland’s robust domestic economy is supporting retail occupier demand and rental values. By contrast, falling exports and slowing employment growth mean that the office and industrial occupier markets are in poorer health. We expect these trends to …
17th July 2013
Over the past five years, investors’ preference for property in Warsaw above Prague has been mirrored by yields in the Polish capital moving the lower of the two. But now that occupier market conditions in Poland have worsened and the outlook for both …
12th July 2013
Our view that logistics property in Germany will underperform the other main commercial property sectors over the coming years is underpinned by the fact that, in both an international and historic context, we think logistics yields look too low and rents …
9th July 2013
The structural slowdown in Russian economic growth suggests that commercial property rents will enter a lower growth phase. This is a concern given that sustained, decent rates of rental growth are likely to have been a key factor supporting convergence …
5th July 2013
News that the Irish economy is back in recession is a reminder that Dublin’s property market still faces significant headwinds. Indeed, all-property capital values in Dublin could yet suffer another modest reverse. But a complete relapse in Dublin’s …
2nd July 2013
The recent rise in bond yields is unlikely to feed automatically into higher European property yields. But to the extent that it increases concerns about the growth outlook and debt burdens, the upside risks to property yields are probably greatest in the …
26th June 2013
The post-credit crunch underperformance by logistics capital values in France relative to the office and retail sectors may leave scope for a period of outperformance. Yet this morning’s business survey data point to worsening economic conditions to come …
25th June 2013
Improvements in Spanish economic sentiment suggest that the recession has eased in the second quarter. Given that there is plenty of headroom for Spanish office and industrial capital values to rise from current low levels, the property market might be …
20th June 2013
The low level of Stockholm office yields reflects safe haven demand and Sweden’s comparatively strong economy. These factors are likely to support yields for the next year or so. On a five-year view, however, the balance of probability points to Stockholm …
19th June 2013
The likely drop in Central & Eastern European (CEE) investment volumes in Q2 will have dashed any hopes that the trend for activity might have turned a corner. Moreover, the recent sell-off in Emerging European currencies and rise in local financial …
13th June 2013
Growing civil unrest is one factor which we have previously highlighted as a risk to the medium-term outlook for Turkish commercial property returns. For now, we are sticking with our central, relatively upbeat view. But with no sign yet that protests are …
12th June 2013
Recent Czech data seem to show that activity in the external sector is on the up. That bodes well for Czech industrial property. But the domestic economy is still fragile and demand from consumer-facing occupiers is likely to be lacklustre. Thus, while …
6th June 2013
The growing differential between office and retail yields in Brussels does not seem sustainable. But if, as we suspect, it primarily reflects investors’ views that retail has the best defensive characteristics given the uncertain economic outlook for …
5th June 2013
Yesterday’s cut in official interest rates in Hungary is good news for property markets in Budapest. But we are sceptical that the latest easing cycle is sustainable. And if, as we expect, interest rates go into reverse later this year, Budapest retail …
29th May 2013
The low level of prime office yields reported in Zurich could be a sign of strong investor confidence in that city. We suspect, however, that they have been artificially depressed by a small number of exclusive prime deals concluded during a period of …
28th May 2013
The outlook for economic growth in the economies outside the single currency region are typically a little brighter than for those within it. Hence we are a little bit more upbeat about near-term occupier and investment market prospects in Emerging Europe …
23rd May 2013
The euro-zone recession shows few signs of easing and we have yet to see its full impact on European property values. At the aggregate level, capital values have been supported by further small falls in yields in some core markets and the strength of …
The impact of the 2009 Polish economic slowdown on commercial property prices was exaggerated by the huge boom in rents and ‘over-convergence’ of property yields that characterised the preceding few years. Now that rents and yields in Warsaw look neither …
15th May 2013
In contrast to our forecast for a modest fall during 2013, German office rental values began the year by posting another rise. Yet with economic sentiment in Germany deteriorating and office take-up falling by a third in the first quarter, we suspect that …
13th May 2013
The signs from the first quarter are that, while the trend for investment demand in Emerging Europe might have turned the corner, in Scandinavia it remains stagnant. The latest survey and hard economic data point to more of the same in the current …
9th May 2013
Surveyors’ relatively upbeat views on Czech commercial property rental value growth prospects seem to be at odds with the weak tone of the latest agency and macroeconomic data. But together with signs that employment in office-intensive sectors is doing …
7th May 2013
The early signs are that the European commercial property investment market got off to a fairly solid start to the year. Transactions were up in annual terms and in line with a five-year average. But with demand still focused only on the most liquid core …
2nd May 2013
The sharp rise in Spanish commercial property investment demand reported in Q1’s RICS Global Commercial Property Survey could reflect anticipation that capital values are now close to a floor. But other news this morning that GDP contracted further in Q1 …
30th April 2013
Ireland’s economy is still fragile, but occupier demand is unlikely to drop further. Thus reports of rising office values in Dublin in the first quarter may well prove a turning point. But Greek GDP is still contracting fast. So the dip in Athens’ office …
25th April 2013
Looming deadlines for stricken German open-ended funds to complete their liquidation processes – or hand over remaining assets to their respective custodian banks – mean that the supply of property for sale in core euro-zone investment markets will rise …
22nd April 2013
The run of dismal consumer sector data from the Netherlands helps to explain why the level of retail yields in Amsterdam is high relative to other major euro-zone retail markets. Indeed, this could be a sign that investors have priced some degree of …
19th April 2013
The recovery in employment in Hungary last year, might suggest that the recent uptick in Budapest office rents marks a turning point. But there is no evidence that job creation has boosted office occupier demand. And with the economic outlook still weak …
17th April 2013
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
