MIPIM: French shopping centres rank first for investors: Savills

France tops the list of preferred shopping centre investment locations in Europe for investors, according to a new research report issued by Savills in partnership with Oxford Economics. The report ranks France as the premier investment destination followed by Germany, UK, Belgium and Poland.

The research benchmarks five key criteria for the 18 European markets surveyed, including sales prospects, GDP volatility over 15 years, consumer spending volumes, letting area ratio to catchment and average rental growth figures. Taking these factors into account, France tops the table due to its economic stability, low GDP volatility and anticipated sales growth of 2.7% pa between 2011 and 2016. Prime shopping centre rents currently stand at EUR 2,000 m2/year.

Poland, which currently ranks fifth is, Savills suggests, a market that could see the most growth due to forecast increases in consumer spending but also a fast-growing population. Its retail sales prospects are among the best of those countries surveyed with a 5.16% average growth (against EU average of 2.2%) forecast between 2011-2016 and limited shopping centre stock - 214 m² per 1,000 habitants.

'There are many cases of excellent shopping centres across Europe that represent a good purchase opportunity. Such opportunities can definitely take investors into new markets across substantial geographies,' said Giles Wilcox, head of cross-border investment at Savills.

'When identifying geographical areas to target it is clear that aside from property fundamentals, consumer spending figures and forecast GDP growth must be taken into consideration. Investors will also continue to be attracted to prime well let and either dominant or sustainable shopping centres. Dominant shopping centres offer the benefits to invest substantial equity into a single deal, with risk and volatility somewhat hedged and plenty of room to benefit from improving economic conditions.'