The economies in the EMEA region have turned a corner and are moving out of recession but recovery across the region will be not be uniform or evenly paced, according to Jones Lang LaSalle. During its Media Briefing at Mipim, the property adviser said the economies are not out of the woods yet, and a number of key drivers will impact the pace and shape of recovery. These themes are defining the 'new normal'.
The economies in the EMEA region have turned a corner and are moving out of recession but recovery across the region will be not be uniform or evenly paced, according to Jones Lang LaSalle. During its Media Briefing at Mipim, the property adviser said the economies are not out of the woods yet, and a number of key drivers will impact the pace and shape of recovery. These themes are defining the 'new normal'.
Christian Ulbrich, CEO EMEA at JLL, said: 'The availability of debt will be a major determinant of pricing this year, especially for tier two assets. Equity players will continue to dominate, but globalisation will result in a change in players and their demands. We see short term opportunities in government and the banking sector, though we expect these to evolve slowly.
Paul Guest, Head of EMEA Research, picked out exceptions to the 'new normal': 'For investors, property remains an attractive asset class in a world of low interest rates and high inflation and rising sovereign risk and we believe there are enough potential buyers to push some EMEA markets out of line with fundamentals. The money is chasing very limited product in light of alternative asset returns.
The common theme for governments across Europe this year, despite upcoming elections in some countries, is the need to save money and cut debt. This will have a double impact on economic growth across the region, although the spending cuts will generate real estate disposal and advisory activity, JLL said. The firm noted that while the market will remain equity-driven, new players are emerging and there will be greater polarisation and differentiation between the best and worst performers. Strömberg said: 'We think that investors who proved themselves trustworthy and stuck to successful strategies in the downturn will be tomorrow’s winners and will attract an increasing share of capital flows.'