Asian deal volumes declined by 50% in the first eight weeks of this year as a result of the Coronavirus epidemic, according to data released this week by RCA.
In Europe, European deal activity is off 18% so far this year compared to 2019. RCA expects the current crisis will be more widely reflected in the Q2 numbers.
RCA pointed out that the time it takes to purchase real estate directly means that there is a structural lag: deals closing in the first quarter of 2020 will have started in the fourth quarter of 2019 or even earlier. That means it may take time for the current dislocation to impact transaction activity.
‘The phenomenon of COVID-19 is more recent in Europe and the Americas than it is in Asia Pacific. Many of the networking events cancelled across the globe have traditionally kicked off the sale processes and it remains to be seen how the curtailment of face-to-face meetings between brokers, buyers and lenders will impact transaction activity,’ RCA’s exec managing director Simon Mallison said. ‘We expect any disruption to be recognized in second quarter numbers in Europe and the Americas.’
