European property investment volumes down 47% QoQ

European real estate investment slowed markedly in the first three months of 2012, surrendering the strong momentum evident in the final quarter of last year, according to figures from PropertyEU Research.

PropertyEU recorded EUR 17.7 bn of real estate transactions above EUR 20 mln between January and end-March this year compared to some EUR 26 bn for the final quarter of 2011. This represents a drop of 47%.

The fourth quarter is generally a very active period as investors and vendors seek to reach agreement prior to the closing of the year. That said, the first quarter of 2012 - which has been characterised by continuing sovereign debt concerns and recession - was also weaker than each of the first three quarters of last year. PropertyEU recorded volumes of around EUR 20 bn for each of the first three quarters of 2011.

PropertyEU Research tracks reported real estate transactions of EUR 20 mln and above across Europe on a daily basis for our monthly and quarterly deal analyses.

In its investment report, property adviser CBRE said European volumes totalled just under EUR 24 bn in the first quarter of 2012. This reflects a 31% fall in activity compared with the last quarter of 2011 and an 18% fall versus Q1 2011, bringing turnover broadly in line with activity during Q1 2010.

The Nordic region was an exception as volumes increased nearly 50% compared with Q1 2011. Jonathan Hull, head of EMEA Capital Markets, CBRE, commented: 'The Nordic markets are increasingly active - government finances are favourable compared with the rest of Europe, as are the prospects for economic growth. Solid fundamentals have driven an increase in the number of foreign buyers looking to enter the region. Sweden remains a key target for many investors and we are witnessing increasing interest in other Nordic markets.'

Read the full deal analysis for the first quarter of 2012 in the May edition of PropertyEU Magazine. Click on the link below to subscribe