Commerz Real Research: The European Office Real Estate Market
Prices for office real estate in Europe have become decoupled from the development of the rental market to a worrying degree in the meantime. This conclusion is reached in the 2016 Office Real Estate Market Report from Commerz Real. Although prime rents on the European office markets have increased virtually everywhere and vacancy rates continue to decline, according to the report this is by no means matched by price developments on the transaction market. As a consequence of the ever tougher competition for high-quality real estate, the average prime yield has declined further in the course of the past year. In the opinion of the market experts at Commerz Real this slowing down is an expression of enhanced risk consciousness on the part of investors and a downturn in the availability of properties.
The basis for the increase in rents according to Commerz Real is, alongside the economic environment, a disparity between the demand for and supply of modern areas. The authors of the study believe the downturn in available space poses an increasing problem for the stability of some markets.
For more details on the subject, check out our latest research report.
Research Report Europe