Slight upturn in European commercial property market

There was a slight upturn in the European commercial property market in the last three-month period, as investors spent €13bn in Europe, bringing total investment spend in the first half of 2009 to €24.5bn, according to findings released today.

Irish investors spent €41.6m domestically in the first half of 2009 and approximately €741m in the UK in the period, according to the CB Richard Ellis Group report.

The €13bn Q2 figure constitutes a 12% increase on the €11.6bn transacted in Q1 2009.

Andrew Gunne, Director at CB Richard Ellis, Dublin commented: “What the second quarter’s activity clearly reflects is that those markets that have seen greatest price corrections are seeing most transaction activity.

“This is particularly true of Spain and the UK, where investors have been attracted to the markets by a perception that they now offer good value.”

Jonathan Hull, Executive Director of EMEA Capital Markets, CB Richard Ellis, said: “We have certainly seen increasing levels of capital focused on the prime European markets and not just London.

“The most notable changes in the market recently have been strong net inflows and the reopening of three German Open-ended Funds, which is encouraging news for the sector. The UK real estate funds are also starting to see positive net inflows.

“Generally speaking, the capital targeting the market has increased and we expect this could translate into an increase in transactions in the second half of the year. Most capital is focused on secure income streams and core product.”

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