The team at Experience Invest look at new figures which show that European commercial property investment activity has reached its highest level since 2007.
Commercial property turnaround
As Europe recovers from the recession, its commercial property sector has started to record impressive growth volumes. Property Wire reported on Knight Frank analysis which indicated that €57.9 billion was invested in European commercial property in the closing quarter of 2014. Matthew Colbourne, international research associate at Knight Frank explained at the time that “the European investment market has continued to gain remarkable momentum. We expect 2015 to be another strong year.”
Highest activity levels since 2007
Savills’ new European Investment Briefing report also shows that a remarkable €102.5 billion was invested in the European commercial property market in the first half of 2015. It shows that the sector’s investment activity levels are now at their highest point since 2007.
The office property market captured 39% of the transaction volume per country on average, dominating European activity investment for the first half of 2015. The sale of retail properties accounted for a higher share of property investment deals than office properties, however, in Portugal (83%), Norway (62%), Finland and the Netherlands (both 43%) and Germany (42%).
The head of European investment at Savills, Marcus Lemli, explained why European commercial property has enjoyed such a stand-out six months. He said that “with healthy investor interest, Europe has seen a shift towards larger transactions. The most significant rises in portfolio deals were noted in Germany and the Nordic markets and consequently, there has been a marked uplift in activity in the regional markets.”
Resilient investment opportunity
Lemli predicts that Europe’s commercial property sector is primed to record continued growth throughout the rest of 2015. “Despite all of the economic uncertainty caused by the Greek crisis, the commercial property market activity across Europe has proven resilient. There is certainly potential for increasing investment volumes in the context of low interest rates, availability of finance and generally better economic conditions.
“We are therefore forecasting an increase of at least 10% to 20% in the commercial investment activity this year.” This suggests that European commercial property could become an even more lucrative investment opportunity in the second half of 2015. You can check back to our blog or follow Experience Invest on Twitter to keep track of how European commercial property performs throughout the rest of the year.
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