Sentiment among real estate professionals around the world improved in the first quarter of 2012. According to the Global Commercial Property Survey from the Royal Institution of Chartered Surveyors (Rics), countries including Brazil, Canada and Russia all saw an improvement in rental expectations, with strong occupier demand recorded in their commercial real estate sectors. However, a similar upturn was not apparent in Europe, with a lower take up of space in nations such as Spain, Greece and France, as well as falling capital values in many continental markets.
Chief economist at Rics Simon Rubinsohn commented: "The better tone to sentiment in the report is encouraging and consistent with the improvement in macro news flow during the first quarter." An increasing number of enquiries about real estate investment opportunities in Canada, Brazil, the US, Germany and Bulgaria was noted in the three months from January to March, indicating it is not all doom and gloom for European commercial property. "The key area of concern remains Europe with much of the continent either in or flirting with recession. The resilience of Germany should, however, provide a measure of support and gradually help bolster growth elsewhere in the continent," Mr Rubinsohn asserted.
Focusing in more detail on the performance of European commercial markets, Rics pointed out capital value expectations were in negative territory for the majority of countries surveyed, with the exception of Switzerland, Poland, Russia and Germany. Unsurprisingly, the nations where confidence in growth is lowest are those that have been particularly badly affected by the sovereign debt crisis, such as Greece, Portugal, Spain and Italy. There are signs investors are re-entering European markets, though, with nine countries recording positive net balances for property investment in the first quarter, compared to just four in the final three months of last year. Interest was greatest in Russian, German and Irish markets, but Italy and the UK are among the destinations also attracting attention.
- Wednesday 09 May 2012