Savills expects volumes in France to total EUR 14b this year

International real estate advisor Savills expects investment volumes in France to total EUR 14 bn by the end of the year, up from EUR 13.3 bn in 2010, bringing the volume back to just below the 10-year average of EUR 14.2 bn. Despite a quiet first quarter, with an anticipated EUR 1.8 bn transacted, the firm expects investors to take advantage of the current high demand for prime stock to put their assets on the market, thereby creating investment opportunities.

In 2011 Savills expects domestic investors to remain the main market players but believes the share of cross border investments will increase gradually throughout the year. These parties dominated the market in 2010 and accounted for more than 63% of total investment volume in Q4 2010.

‘Domestic investors know the market like the back of their hand, allowing them to take an aggressive position in terms of pricing. While they will remain the key market players in 2011 we expect appetite from foreign investors to grow,’ said Lydia Brissy, head of research at Savills France.

Savills also predicts that while offices will continue to be the main target asset, investment in French retail will continue to increase. This sector is seen as increasingly transparent with attractive yields compared with other asset types, Savills said.