Italy's property market to slow down in 2009, says C&W

Italy’s real estate market is likely to slow down next year due to a combination of the global credit crunch and an increase in real estate taxes, according to Cushman & Wakefield head of Rome office Joaquim Sandberg.

Sandberg told PropertyEU at the MIPIM trade fair in Cannes that tenant demand for commercial real estate space is likely to diminish between now and 2009 following a significant increase in the last five years.

Take-up of commercial space in Rome rose from 80,000 m² in 2006 to 130,000 m² last year, largely due to increased demand from large multinationals, Sandberg says. The increase in take-up levels was the main driver of rent growth over the last few years.

Sandberg also expects the new real estate investment trusts introduced in Italy at the end of 2007 to attract an increasing number of international investors to the country, helping the market into an early recovery.

However, he added that it will take some time before these tax-efficient investment vehicles take off because they are still not flexible enough. C&W is active in the Italian market through its 152 offices.