Real estate investors are painting a comparatively positive picture of Germany as a place to invest in 2009 despite the difficult economic conditions globally and plunging property prices in several European counties, Ernst & Young Real Estate has said.
Real estate investors are painting a comparatively positive picture of Germany as a place to invest in 2009 despite the difficult economic conditions globally and plunging property prices in several European counties, Ernst & Young Real Estate has said.
The German arm of Ernst & Young Real Estate bases its conclusion on its annual trend survey of around 100 companies. The firms which took part in the survey include open-ended real estate funds and investment companies, insurance companies, housing associations, family offices and real estate PLCs.
Around 70% of the companies surveyed expressed a desire to invest in Germany again this year. More than 90% will deploy a higher level of equity capital than in previous years. 'In light of the ongoing difficult economic situation and the unfavourable financing conditions, the real estate investment market for 2009 is likely to shrink by around 15% against last year,' says Hartmut Frund, managing partner of Ernst & Young Real Estate GmbH. 'We believe that in 2009 a volume of around EUR 20-24 bn will be reached with commercial and residential real estate. This is roughly on a par with 2004. The volume of the market will be particularly dependent on the level of distressed sales in 2009.'
