European prime shopping centre yields have risen from 5.0% at end 2007 to around 6.3% at present, with secondary yields reaching as much as 7.25%, compared to 5.8% a year ago, research from Savills shows.
European prime shopping centre yields have risen from 5.0% at end 2007 to around 6.3% at present, with secondary yields reaching as much as 7.25%, compared to 5.8% a year ago, research from Savills shows.
'Despite the obvious difficulties in the European retail investment market, yields are generally beginning to move out, making prime shopping centre properties increasingly affordable compared to the peak of the market in mid 2007,' said Eri Mitsostergiou of Savills European research. 'For those investors who have the equity, this affordability may begin to present opportunities for good value deals.'
According to Savills research, 2008 saw 171 retail transactions in Austria, Belgium, Germany, Finland, France, Ireland, Italy, Netherlands, Portugal, Poland, Spain, Sweden, UK and Turkey, equating to a total volume in the region of EUR 15.5 bn. Almost 60% of these transactions took place in the first half of the year with 56% of total volume transacted in the same period.
The largest portion of retail capital invested in Europe was in Sweden, with 20%, followed by the UK at 15% and Germany at 14%. Yields are said to have been lowest in Finland in 2008 at 4.5 - 5% and highest in Turkey at 8 %.
Almost one third of transactions were portfolio transactions composed mainly of retail warehouses and supermarkets, and that, in terms of individual deals, almost half of these pertained to shopping centres and more than 40% related to retail parks/warehouses.
