There has been a greater level of activity among investors in the commercial property sector in Europe during the third quarter of 2011, compared to both the same period a year earlier and the previous quarter, the latest figures from CB Richard Ells (CBRE) show. Investment volumes in this asset class were up by seven per cent over the third quarter of 2010 and rose by two per cent compared to the three months from April to June.
Italy and France topped the list as some of the most active investment markets on the continent, both registering a substantial jump in interest from investors. In Italy, this was attributed to the completion of a couple of large deals during Q3. In addition, CBRE noted that a greater number of properties on the market in Paris helped boost investment in the French market.
Head of Europe, Middle East and Africa capital markets at the firm Jonathan Hull stated that commercial property investment volumes are now expected to exceed those recorded in 2010 this year. He added: "The last quarter has reinforced some of the earlier trends seen in Europe over the last year or so, such as that prime real estate is holding up fairly well, even in the current uncertain climate." However, Mr Hull commented that secondary markets are exhibiting signs of weakness at present.
Meanwhile, another recent CBRE report revealed that rents and yields across prime commercial property in Europe are holding steady, despite the economic problems and concerns over sovereign debt on the continent. Although the organisation recorded a marginal drop in yields for offices, rents in this category remained largely unchanged - and a study published by Savills earlier this month suggested that the prime central business district (CBD) office markets could even be on the way up.
According to the real estate experts, rental growth is expected in a number of the continent's top locations, particularly in Germany, Sweden and the UK. In fact, by the end of next year the firm anticipates rents in London's West End will be 11.1 per cent higher than present, while Berlin and Stockholm will experience increases of 3.5 per cent and 7.9 per cent respectively in the same period.
- Friday 14 October 2011