Safe haven markets upgraded to ‘hot’: DTZ

Retail investment assets in Berlin and Copenhagen have been upgraded to 'hot' property in DTZ's latest European Fair Value report from their previous 'warm' rating in the third quarter of 2011.

DTZ said the upgrades reflect a continued tightening of bond yields in Germany, Denmark and the UK which has increased the relative attractiveness of property even though the outlook for underlying market performance remains broadly unchanged. Offices in Madrid were also upgraded and are now rated as ‘warm’ compared to their previous 'cold' reading.

Downgrades in Q4 2011 include Brussels retail (from warm to cold), Budapest retail (from warm to cold) and Marseille office (from warm to cold).

Although only nine markets were rated as hot in Q4, reflecting subdued capital growth expectations, the majority of markets in the Fair Value Index (52 out of 98) are rated warm. Combined, this indicates that 'prime property is providing investors with a relatively attractive proposition in a troubled economic climate', DTZ said.