Investment in the German retail property sector amounted to EUR 3.47 bn in 2009, down 43% on the previous year, according to figures published on Tuesday by CB Richard Ellis Germany. The decline, which was in line with expectations, was primarily due to more difficult financing conditions and an accompanying fall in the number of potential buyers.
Investment in the German retail property sector amounted to EUR 3.47 bn in 2009, down 43% on the previous year, according to figures published on Tuesday by CB Richard Ellis Germany. The decline, which was in line with expectations, was primarily due to more difficult financing conditions and an accompanying fall in the number of potential buyers.
Large-scale retail properties dominated 2009 investment volumes, with shopping centres taking the lion's share at 33%. Jan Dirk Poppinga, head of retail investment at CBRE Germany, commented: 'At present we are observing that capital-rich institutional investors with strong capital inflows are restructuring their previously office-heavy portfolios towards retail. Besides prime shopping centres, first-class retail parks are also top of their lists. The high-volume transactions seen in 2009 were essentially executed by these investors - in some cases with 100% equity.'
The biggest buyers of German retail assets last year were German open-ended funds and special funds, which together accounted for EUR 1.36 bn of the total volume, op 23% on 2008. Cash-rich insurance and pension funds were also big buyers, spending around EUR 0.5 bn. Wealthy private investors accounted for around 12% of total transactions.