Europe sees €60b of deals in Q4 alone, says RCA

Europe experienced its best quarter for commercial real estate investment since the global financial crisis in the final three months of 2013, analysis by research firm Real Capital Analytics (RCA) shows.

A total of €60.1 bn of property transactions was recorded in the fourth quarter of last year, up 52% on the year-earlier period, according to data compiled by RCA. The figure reflects a surge in the number of transactions in the continent’s peripheral and emerging markets,

The strong quarterly figures lifted investment volumes to €177.8 bn for 2013 as a whole, or 17% more than the previous year.

Simon Mallinson, RCA’s managing director for EMEA, said: 'As concerns about the break-up of the eurozone abated, this stoked a significant pick-up in interest from investors across the globe looking to snap up assets outside Europe’s core markets at attractive prices. The acceleration in Q4 that we saw in Europe is in marked contrast with the slowdown in transactions experienced in the Americas and the Asia-Pacific region.'

Transaction volumes in Greece, Ireland, Italy and Spain all jumped by more than 80% in 2013 from a low base, while RCA data show that investment in Central Europe and Eastern European markets, like Turkey and Russia, also rebounded strongly.

Investor appetite for the Nordic and Swiss markets, which acted as safe havens during the financial crisis and subsequent eurozone turmoil, diminished markedly in 2013.

France stood out among core western European real estate markets with a 7% drop in investment volumes last year to €18.4 bn, a trend that accelerated notably in the fourth quarter. Paris, Europe’s No. 2 investment destination after London, suffered a 15% slide in investment volumes to €12.2 bn led by a drop in deals for offices and retail-related properties.

Joseph Kelly, RCA’s head of EMEA research, commented: 'This is the second year of deteriorating volumes for Paris office investment, which had performed relatively well during the crisis. France sticks out compared with the buoyant core western European markets of Germany and the UK, indicating that economic, fiscal and political uncertainty deterred investment there in 2013.'