Property Investment In Europe To Fall By 25 Per Cent In 2008
Direct commercial real estate investment activity totalled 244.1 billion euro across Europe in 2007, four per cent lower than 2006, and 25 per cent higher than 2008’s expected volume, according to Jones Lang LaSalle’s recent report.
Whilst in continental Europe volumes remained strong, increasing seven per cent year-on-year to 173 billion euro, the UK was hit more than other countries and volumes slipped by over 22 per cent year-on-year to 71 billion euro in 2007.
“Capital continues to be attracted to Europe’s real estate markets, but its deployment is being slowed by reduced confidence in the face of pricing correction and weaker returns,” said Tony Horrell, Head of European Capital Markets at Jones Lang LaSalle. Nigel Roberts, Chairman of European Research at Jones Lang LaSalle added: “We expect increased clarity over pricing and confidence to return to the market later in the year. However, this is likely to be too late to avoid European transaction volumes falling by 25 per cent overall in 2008 as a result of first half falling values and slow investment activity.”