Expect a year of political uncertainty and the challenge of rising interest rates in Europe in 2017 Politics aside, however, the gradual tightening of some occupier markets seen in 2016 will continue in 2017, especially for better properties in the better locations Despite a gradual turnaround in the long-term interest rate trend, there is still scope for further yield compression in prime assets as rental growth and low interest rates by historical standards continues to make property look attractive 2018 or 2019, rather than 2017 are likely to be the years when the yield cycle starts to turn
This year’s guide is the largest and most comprehensive yet with 64 EMEA cities featured including certain global hubs such as Hong Kong, New York City and Mexico City. Throughout the guide we demonstrate how traditional office settings compare to the more wide spread application of agile working environments.
•Commercial Real Estate investment in Europe totalled €86.8 billion in Q4 2016, the highest investment total recorded. This brought the total for 2016 to €251.1 billion. •Germany was Europe’s largest investment market in Q4 with €19.8 billion invested. •While the 2016 total for Europe is down 10% on 2015, if we exclude the UK market the investment total rose 5%.
The European Hotel Investment MarketView highlights the key trends pan-Europe in terms of hotel transaction volumes, operating performance and yields. This particular issue includes a year-end round-up of 2016. Germany topped the table for European hotel investment in 2016 European hotel investment volume was €20.4bn, down -7% on 2015 A splurge of investment activity was noted in Q4 Intra-regional investment dominated in 2016 Greatest operating performance growth noted in Central, Eastern and Southern European markets Capital value growth recorded in most key European markets
PRIME RENTS •Trend of prime rental increase continues, albeit by small increments. •Central London markets begin to turn while major German markets outperform. DEMAND •Take-up levels continue to rise, with CEE markets particularly strong. VACANCY •Vacancy rates continue to decline, with most locations seeing some tightening. •Polish markets lead the quarterly decline for second quarter running. DEVELOPMENT •Pipeline still relatively static, though signs of expansion in late recovery markets like Dublin, Madrid and Barcelona. INVESTMENT •Record Q4 European investment, with Sweden leading the annual increase in the office sector.