Real Capital Analytics / April 29th, 2020
London, April 29, 2020 – Real estate investment volume in Europe during the first quarter totalled €64.2 billion, up 7% compared with the year-earlier period, but the sharp slowdown in deal flows in March after the onset of the Covid-19 pandemic, and the uptick in withdrawn transactions, signal markets are likely heading into further hefty pullbacks in activity, Real Capital Analytics’ European Capital Trends report for Q1 2020 shows.
(Tom Leahy, Senior Director EMEA Analytics at RCA will expand on the ECT Q1 analysis in a webinar on Thursday, April 30th at 09:00 GMT/10:00 CET. Registration details at the bottom of this news alert.)
RCA concludes that those markets most dependent on non-domestic sources of capital, broadly those in Southern and Central and Eastern Europe, potentially face the biggest declines in investment. For example, Warsaw has recorded a sharp uplift in deal volumes in the last two years, but almost all of this is from overseas investors, making it more vulnerable than other cities such as Stockholm, Frankfurt or Paris, where a large and sophisticated domestic investor base exists.
Retail is the property sector that will likely be most negatively affected by the crisis over the long term and RCA foresees the growth in investment volumes reversing in the second quarter, while capital values will continue to fall in the least favored sectors. Another part of the market that looks to be under strain from the crisis is coworking offices. By contrast, the industrial segment is much better placed to weather the current storm after turning in the best ever first quarter for warehouse investment across Europe. The RCA price indicator shows a 9% increase in capital values for Western European logistics warehouses in the last 12 months.
NOTE TO JOURNALISTS:
RCA Webinar: Commercial Real Estate in the Time of Covid-19
Real Capital Analytics is hosting an online discussion and analysis of the impact of Covid-19 on European commercial real estate markets with Tom Leahy, Senior Director at RCA, at 9 am GMT/10 am CET on Thursday, 30th April. During the webinar, Leahy will provide a summary of current market data and also show how this compares to the Global Financial Crisis. He will conclude with an outlook for market developments in the upcoming period. Journalists wishing to join the webinar or who would like to receive the recording following the event can register here.
Date: Thursday, April 30th 2020
Time: 9.00 GMT/10.00 CET
Register Now >
Note to editors:
Real Capital Analytics (RCA) is the authority on the deals, players and trends that drive the commercial real estate investment markets. Covering all markets globally, RCA delivers timely and reliable data with unique insight into market participants, pricing and capital flows. The most active investors, lenders and advisors depend on RCA’s market intelligence to formulate strategy and to source, underwrite and execute deals. An industry pioneer since 2000, RCA has offices in New York, San Jose, London and Singapore. For more information, visit rcanalytics.com.
Steve Hays, Bellier Financial
+31 (0)20 419 0901