Real estate contributes 2.5% to European economy: report

The commercial real estate industry contributes 2.5% to the total economy of Europe, more than the automotive, telecommunications and banking industries, according to new research commissioned by the European Association for Investors in Non-listed Real Estate Vehicles (INREV) and the European Public Real Estate Association (EPRA).

While other studies have shown that real estate in all forms accounts for nearly 20% of total economic activity, the new study reveals that the commercial property sector alone generated EUR 285 bn for the European economy in 2011 and employs over four million people.

INREV said the report, entitled Real Estate in the Real Economy, was designed to help national governments across Europe, officials in the European Commission and members of the European Parliament better understand the scale and importance of the industry in supporting growth, jobs and sustainability. It provides a Europe-wide perspective on the sector for the first time. Historically, data relating to the economic significance of the commercial real estate sector has only been collected at a national level, and often in an inconsistent manner, INREV said.

Where individual national measures of GDP reflect the real estate market, they generally incorporate the commercial sector within a very broad calculation. In the UK, for example, real estate statistics include all economic activity related to the construction and sales of owner-occupied residential property.