The decline in office and retail rents in Sweden and Denmark has bottomed out, marking an end to the downward trend seen over the past few years, according to a report on the Nordic markets by German bank DG Hyp. Finland is the exception, with rents there predicted to fall further in 2010.
The decline in office and retail rents in Sweden and Denmark has bottomed out, marking an end to the downward trend seen over the past few years, according to a report on the Nordic markets by German bank DG Hyp. Finland is the exception, with rents there predicted to fall further in 2010.
Office rents in Stockholm could even begin to increase slightly by 2011 if domestic demand remains solid and the pace of foreign trade accelerates, according to the German bank. However, on a country-wide basis, rents are likely to stagnate in Sweden next year. Prospects for Danish rents are slightly better than for Sweden due to low vacancy rates. By contrast, rents in the Finnish office market are predicted to decline further, by as much as 5% in Helsinki in 2010, due to the continuing impact of the recession. The vacancy rate in Stockholm stood at 11.2% in 2009, compared with 7.9% in Copenhagen and 10.4% in Helsinki.
In the retail sector, rents in Stockholm are unlikely to decline further this year, paving the way for modest growth in 2011. Retail rents in Copenhagen declined by 2.8% in the recession year of 2009, but are likely to be around 1% below last year's level in 2010. In Helsinki, DG Hyp expects retail rents to decline by another 2% this year as the macroeconomic weakness continues in Finland, and to stagnate in 2011.