Property adviser CBRE reports evidence of broadening investor demand for better quality secondary retail property assets in core European markets.
Property adviser CBRE reports evidence of broadening investor demand for better quality secondary retail property assets in core European markets.
CBRE noted the trend in its latest update which shows European retail property investment activity jumped to €13.5 bn in the fourth quarter of 2012.
This was a 50% increase on the three-year quarterly average of €9 bn and an impressive 90% change from Q3 2012.
The latest results follow three relatively quiet quarters, when an average of €6.4 bn changed hands, largely due to a lack of core product. The strong Q4 2012 figures were heavily influenced by the 'year-end effect', which was more pronounced in the retail sector than in the overall European commercial real estate investment market. Q4 2012 European retail investment was up 36% compared with the same period in 2011.
Western European markets, especially Germany and the Nordics, attracted the majority of retail property investment in Q4 2012. In Norway, retail investment was substantially up on Q4 2011, pushing it into Europe’s top five largest retail investment markets in 2012.
Germany is increasingly popular with international investors, with cross-border activity in the retail sector soaring to almost 60% in the second half of 2012. Stronger economic fundamentals, and local players taking advantage of favourable market conditions to sell, have benefitted these economies.
Recent deals in Scandinavia include the €500 mln plus Kista Galleria in Stockholm and NIAM's disposal of its 72.5% share in Sektor Gruppen, Norway. In Germany US private equity firm Lone Star acquired over €1 bn of assets in the east of the country, with retail accounting for a significant proportion of the total.
