Investment in commercial real estate in Europe in H1 2019 came in at € 101.8bn, i.e. 13% less than the record level of 2018. The decline applies to all asset categories apart from hotels, which were up 26% to € 10.2bn, close to the 2015 record (€ 10.7bn). This was thanks to several major deals including portfolios in Italy, France and the Czech Republic in particular. The office segment (€ 47bn) slipped just 6% thanks to two transactions of over € 1bn in Paris and numerous huge deals in the leading German markets. Logistics fell 16% with investment of € 13.1bn; which remains 30% above the long-term average. The retail segment saw the biggest decline (-31%) with investment of € 16.4bn, well below the long-term average, suggesting dwindling enthusiasm among investors for this asset category.
With investment of € 24.4bn, Germany ranked first among European countries. Despite the slight fall, investment in the country was in line with the five-year average. In the biggest cities (apart from Berlin which saw record figures), the fall was due to a lack of assets rather than weaker demand. Usually in pole position, the UK was in second place with investment of € 22.1bn, a steep fall compared to H1 2018 (-33%), but also well below the long-term average. Amid the uncertainty of Brexit, many investors have put their strategies on hold until the situation becomes clearer. After the record figure of € 34bn in 2018, France started 2019 with the same impetus (+0%) with € 13.7bn invested. The market was driven by offices, which accounted for 70% of the total. Most other European countries enjoyed an upward trend, such as Belgium (+105%), Italy (+96%), Spain (+88%), Poland (+57%) the Czech Republic (+31%) and Ireland (+6%). Only Holland (-55%), Luxembourg (-22%) and Romania (-65%) saw a decline.
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