EMEA Market Snapshot Capital Markets | Q1 2022 - Colliers
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EMEA Capital Markets Snapshot | Q1 2022 Capital Markets | Q1 2022 EMEA Market Snapshot
EMEA Capital Markets Snapshot | Q1 2022
Overview
Russia’s indefensible invasion of Ukraine cast a cloud over the post- Q1 Pricing Direction Q2 Pricing Forecast
pandemic recovery that was continuing into first quarter of 2022. Office
The sanctions imposed on Russia and knock-on effects on global
commodities, further disrupted global supply chain issues driving higher Logistics /
inflation and interest rates. However, investment appetite and capital
Residential / /
has remained resilient with both transactions and new fund-raising
continuing. Retail /
For now, analysing Q1 2022 activity, we are specialist retail stores. Italy also posted an exceptional Hotel
encouraged to see that investor confidence in the Q1 and the UK saw a 10% year-on-year rise in volumes.
region’s CRE fundamentals and future prospects Activity in France was more subdued, with a 7% decline
remains strong. Provisional figures for Q1 2022 put in activity from the previous year.
European investment volumes by sector: Quarterly
European volumes up 5% over Q1 2021, and rolling
One company stood out over the quarter. Google € billions
12-month volumes up by 7%, with many investors Hotel Retail Apartment Industial Office
and its parent group Alphabet have reaffirmed their
continuing to view commercial real estate as a hedge 160
commitment to the physical office, with Alphabet CEO
against rising prices. The bidding landscape remains 140
Sundar Pichai increasingly vocal about the importance
highly competitive with investors looking to deploy 120
of office investment. This intent was on full display in
available capital that is nearing 2019 levels again.
Europe in Q1, with Google closing deals on campuses 100
In the major markets of Western Europe, overall in London (€879 million) and Warsaw (€583 million). 80
performance was robust. Germany saw a record This bodes well for the vibrancy of Europe’s prime 60
opening quarter as investment flocked into crisis- office markets even amid the uncertain months ahead.
40
resistant segments such as DIY and food-anchored
20
0
Q1 2017
Q2 2017
Q3 2017
Q4 2017
Q1 2018
Q2 2018
Q3 2018
Q4 2018
Q1 2019
Q2 2019
Q3 2019
Q4 2019
Q1 2020
Q2 2020
Q3 2020
Q4 2020
Q1 2021
Q2 2021
Q3 2021
Q4 2021
Q1 2022
Luke Dawson
Managing Director | EMEA Cross-Border Capital Markets
luke.dawson@colliers.com
+44 20 7344 6788
Source: Real Capital Analytics
EMEA Capital Markets Snapshot | Q1 2022
UK Sectors
to watch
Q1 Pricing
Direction
Q2 Pricing
Forecast
Industrial across Office
There are mountains of capital for every sector with some headwinds from build costs, all submarkets,
PRS residential,
interest rates and ESG. Pricing remains firm. Logistics
long-income, life
sciences, data
centres, offices in Residential
Market Review the right location
• Investment volumes reached €15.6 billion in Q1 • Investors are looking at shopping centres again. Retail
2022, up by 10% on the €14 billion transacted in The sector witnessed transactions worth
Q1 2021 and in line with the 10-year Q1 average. €889 million, the highest quarterly figure in Hotel
over five years. Yields have started to compress.
• The number of +€100 million transactions stood
at 28 in Q1 2022, up from 19 in Q1 2021 and 22 • The purpose-built student accommodation sector
All sector capital value index
in Q1 2020. attracted €1.8 billion, making it the fourth-best
quarter on record. Six deals were larger than 120
• Over €6 billion was transacted in the office sector,
€60 million. Residential volumes were close to
more than double the corresponding 2021 figure
€1.2 billion.
of €2.5 billion. Most of the activity was recorded in
London (€5.6 billion). US and Asia-Pacific investors • Yields are compressing across most sectors,
100
were particularly acquisitive as the easing of travel especially for prime assets in prime locations.
restrictions brought global capital into the market. MSCI all-property yields are at a record low.
Despite narrowing, the all-property yield/gilt
• Despite a quiet January, quarterly investment
spread will settle at around 275 basis points.
volumes in the industrial sector reached €3 billion. 80
Several assets sold at sub-4% yields. 03’17 09’17 03’18 0918 06’19 09’19 06’20 09’20 06’21 09’21 03’22
Source: Colliers Leeds Bristol Manchester
Glasgow Birmingham London
Largest Q1 deal: Second-largest Q1 deal: Third-largest Q1 deal:
5 Broadgate, London EC2 Central St Giles, London Retail portfolio (Cheshire John Knowles | Head of National Capital Markets I UK
Highlighted (710,000 sq ft of office WC2 (710,000 sq ft of Oaks Designer Outlet john.knowles@colliers.com
Top Three space). Bought by office space). Bought by and Swindon Designer +44 7979 245792
Deals NPS of South Korea for Google for €879 million in Outlet). Bought by LaSalle
€1.4 billion. Largest office an off-market transaction, Investment Management Andrew Thomas | Head of International
deal since 2017. at a net initial yield of for €721 million. Capital Markets | London
3.91%. andrew.thomas@colliers.com
+44 7793 808181
EMEA Capital Markets Snapshot | Q1 2022
Germany Sectors
to watch
Q1 Pricing
Direction
Q2 Pricing
Forecast
Food-anchored Office / /
The German investment market posted a record start to 2022 despite the ongoing effects of
retail, logistics,
the pandemic and geopolitical tensions. trophy office
Logistics
buildings, ESG-
Market Review compliant assets
across all asset Residential
• Q1 2022 saw record investment of €18.2 billion. • Demand for industrial and logistics assets and
Three quarters of the volume was attributable to portfolios was again strong (21% market share)
classes
strategic corporate acquisitions in crisis-resistant and took second place behind offices (51%). While Retail*
sectors and markets. Most notable were the prime office yields in the BIG 7 cities remained
takeover of the alstria Office REIT by Brookfield at the low level of the previous quarter, logistics Hotel
and the 60% takeover of VIB by DIC Asset. yields continued their downward slide, further
approaching office yields.
*
Retail: Grocery , Shopping centres & High street
• Worth €4.8 billion, alstria’s portfolio comprises
over 110 office properties in the country’s major • Overall, despite the geopolitical crisis, market All sector capital value index
investment hubs. DIC‘s interest was focused in momentum suggests another strong investment
180
particular on industrial and logistics (I&L) properties year, in which interest in real estate as a hedge
particularly in southern Germany, as well as against inflation will continue to grow. 160
around 40 retail properties from crisis-resistant
sectors (DIY, food-anchored specialist retail stores). 140
Both major deals contributed significantly to a
120
reinvigorated portfolio share of volumes (44%).
However, trophy buildings such as the Marienturm 100
office tower in Frankfurt’s banking district also
80
remain highly popular with investors. 03’17 09’17 03’18 0918 06’19 09’19 06’20 09’20 06’21 09’21 03’22
Source: Colliers Berlin Dusseldorf Hamburg
Frankfurt Munich
Office portfolio: 91.6% Mixed-use portfolio (I&L, Office single deal:
company takeover of retail): 60% company Marienturm Frankfurt, Christian Kadel | Head of Capital Markets
Highlighted alstria Office REIT by takeover of VIB by DIC Aermont Capital/Pecan christian.kadel@colliers.com
Top Three Brookfield, 110 assets in Asset, 110 assets; approx. (seller), DWS on behalf +49 151 68850231
Deals major investment hubs, €900 million. of National Pension
€4.3 billion. Service of Korea, €800
million.EMEA Capital Markets Snapshot | Q1 2022
France Sectors
to watch
Q1 Pricing
Direction
Q2 Pricing
Forecast
2022 started on a quiet note in the French market with €4.6 billion of transactions recorded Office core and Office
value-add (in
in Q1, down 7% on Q1 2021. The slowdown was even more pronounced in the Greater Paris
Paris)
Region (€2.9 billion invested, down 19% year-on-year). Logistics
Residential
Logistics Residential
Market Review
Healthcare
• While investment activity is still subdued the • Amid strong uncertainty linked to the geopolitical Retail
office sector has continued to be the driving force situation and the French presidential elections,
of the market, accounting for nearly 80% of Q1 prime yields have remained stable, at record levels Hotel
investment volume. for Paris CBD office prime yields (2.70%) and prime
logistics assets (3.00% for warehouses located in
• On the back of solid fundamentals and increasing
the Greater Paris Region). The upward trend for All sector capital value index
rental values, the logistics sector attracted around
rental values for these specific asset classes may
€1 billion of deals, including the sales of several 150
lead to further yield compression in the coming
pan-European or country-level portfolios.
quarters.
125
• The largest deals of the quarter involved a diverse
range of buyers and sellers with a majority of
100
domestic players, including Primonial REIM and
BNP Paribas REIM, as well as European investment
75
funds such as AEW Europe or Principal Real Estate
Europe.
50
03’17 09’17 03’18 0918 06’19 09’19 06’20 09’20 06’21 09’21 03’22
Source: Colliers Paris
Office single asset: €500 French part of a pan- Office single asset: €256
million, below 4% – 90 European logistics asset million Prime office asset
boulevard Pasteur Paris portfolio: €375 million, in Paris CBD. 10 000 sqm.
Highlighted Philippe Ravoire | Senior Director, Capital Markets
15th let to Amundi. 12- approx.3.70%. 320,000 Bought by Financière
Top Three philippe.ravoire@colliers.com
year leasing contract, sold sqm of warehouses sold Dassault from a JV (AXA
Deals +33 6 86 18 20 86
by Primonial Real Estate by Blackstone to GLP IM/NBIM) – let to Le Figaro.
Investment Management Europe.
to Société Foncière
Lyonnaise.EMEA Capital Markets Snapshot | Q1 2022
Netherlands Sectors
to watch
Q1 Pricing
Direction
Q2 Pricing
Forecast
Logistics, Office
residential and
The war in Ukraine and resulting inflationary pressures are creating a lot of uncertainty for office
Logistics
the real estate sector in the Netherlands, which benefited from low interest rates in previous
years. Residential
Retail
Market Review
• After a recovery in the previous two quarters, • Retail and hotels showed quite low activity. Good Hotel
dynamics in the office market in Q1 were quality retail investments are scarce but we do see
somewhat more subdued again. This is also related interest returning, and even yield compression
to a lack of supply, as demand for core investment for the best product as a result. The low volume All sector capital value index
product remains high and there are no yield shifts of hotel transactions is also caused by a limited 160
visible. However, in late Q1 and early Q2, marketing number of offerings. Owners are not willing to sell
campaigns for several large core offices were their hotels with a discount, despite the impact of 140
launched in Amsterdam and Rotterdam. COVID-19 over the last two years.
• Demand for logistic assets remains high and large 120
deals are still prevalent. The bid of Prologis on
Mileway (€21 billion) is underlining this. Investment 100
volumes for healthcare and residential were rather
low. Residential investments rely mainly on new 80
03’17 09’17 03’18 0918 06’19 09’19 06’20 09’20 06’21 09’21 03’22
developments which are limited in number.
Source: Colliers Amsterdam Rotterdam
Dré van Leeuwen | Partner, Executive Director
Logistics: Mirastar acquired a value- Retail: Mitiska REIM acquired the Capital Markets & Agency
add industrial portfolio of 7 assets in 35,000 sqm LFA convenience centre
Highlighted dre.vanleeuwen@colliers.com
the Netherlands, with a total size of Makado in Beek for €56 million from +31 6 50 67 10 93
Top Deals
69,000 sqm LFA. The properties are Syntrus Achmea. This was the largest
partially leased. The acquisition price shopping centre transaction in the
was €47 million. Netherlands in 2.5 years.EMEA Capital Markets Snapshot | Q1 2022
Ireland Sectors
to watch
Q1 Pricing
Direction
Q2 Pricing
Forecast
Ireland is a core market for international investors, who are competing for limited Residential, Office
healthcare,
opportunities across the PRS, office and logistics sectors. €762 million was invested in Q1 with
industrial and
50% attributable to residential. Logistics
office
Market Review Residential
• The Q1 outturn of €762 million represents a decline and there is very low supply which is driving rental
of 37% relative to Q1 2021, a result of limited growth. The second-largest deal of the quarter saw Retail
opportunities and slower completion time rather Union Investment acquiring Primark’s new 595,000
than decreased demand. sq. ft. distribution centre by way of a forward Hotel
funding deal.
• Residential is the dominant asset class but there is
also strong demand for offices, particularly in the • We have seen several new investors entering
All sector capital value index
€40-60 million price range. Investors are attracted the market which demonstrates confidence. An
by an increasingly international tenant base that example is French fund Sofidy which has acquired 140
is taking up new, world-class offices in Dublin. three office properties since Q3 2021 with a total
The limited supply of Grade A offices available for spend of €69 million.
120
investment is driving strong pricing.
• Investor sentiment towards Ireland remains
• Capital allocations to industrial & logistics are extremely positive and strong activity is expected
increasing and yields have now moved sub- throughout 2022, despite inflationary headwinds 100
4%. Demand has been driven by the growth of and geopolitical turbulence.
e-commerce, particularly in the context of Brexit,
80
03’17 09’17 03’18 0918 06’19 09’19 06’20 09’20 06’21 09’21 03’22
Source: Colliers Dublin
Student Industrial & Logistics: Mixed-Use: Irish fund
Highlighted Accommodation: Ares Union Investment agreed Ballybunion Capital
Real Estate Group and a deal with Primark acquired a mixed-use
Top Three
Generation Partners to forward fund the retail and office asset
Deals Michele McGarry | Director, Head of Capital Markets
acquired the ‘Project Ruby’ planned 595,000 sq. ft. at Point Square, Dublin
student accommodation Penneys warehousing 1 for €85 million / 5.2% michele.mcgarry@colliers.com
portfolio for €150 million and distribution facility in NIY. This asset includes +353 87 2050515
/ c. 5% NIY. The deal Newbridge, Co. Kildare for a 103,000 sq. ft. office
included two assets in €128.7 million / 3.6% NIY. block and a 242,000 sq. ft.
Dublin and one in Cork shopping centre anchored
with a combined total of by Dunnes Stores (not
664 student beds. included in the sale).EMEA Capital Markets Snapshot | Q1 2022
Spain Sectors
to watch
Q1 Pricing
Direction
Q2 Pricing
Forecast
In Q1 2022 the volume of investment reached €4.16 billion, 27.9% above the quarterly Leisure hotels, Office
average of 2021, maintaining the good pace of Q4 2021 (€4.26 billion). Yields have remained logistics,
stable with slight compressions in the logistics and living sectors. Yields remain low due to residential
Logistics / /
high CPI inflation and significant liquidity seeking opportunities in the real estate sector. multifamily, office
and alternatives
Residential / /
Market Review
• Investment in the first quarter break down as follows: • With almost €1.1 billion of hotel investment, Q1 set an Retail
the hotel and living sectors with more than €1 billion investment record for the first quarter of the year and
(26% share) apiece, industrial & logistics (I&L) with exceeded the investment volume for the whole of 2020.
Hotel
€784 million (18.9%), offices with €675 million (16.2%), Both investor appetite and market liquidity are at record
retail with €375 million (9%) and other at €159 million levels, contributing to price sustainability. Investors
(3.8%). continue to focus on All sector capital value index
resort hotels.
• The I&L sector continues to be one of the most 160
attractive for investors in Spain. With yields at record • Investor interest in the office market remains at
lows and construction prices soaring, some land price record levels, though there are very few products on 140
containment may allow for development deals. For the market. Madrid and Barcelona continue to be the
assets in rent, the strong CPI inflation will help to preferred destinations for investors, with more than 120
increase their profitability. 68% of investment.
• In the living sector, residential developers are concerned 100
about construction cost increases and
c. 50% state that they have already been forced to 80
03’17 09’17 03’18 0918 06’19 09’19 06’20 09’20 06’21 09’21 03’22
suspend construction work or to put off the launch of
some of their projects. More positively, PRS buildings Source: Colliers Barcelona Madrid
are in very strong demand and BTR products can be sold
with very attractive conditions on a speculative basis.
Alberto Díaz | Managing Director
Hotels Portfolio: Industrial & Logistics: Offices: Beraunberri/ Head of Capital Markets
Eurazeo acquired five EQT Exeter bought a Onchena family offices alberto.diaz@colliers.com
Highlighted Ayres Hotels from logistics portfolio from acquired Vizcaya Tower in +34 645 801 840
Top Three Palladium and El Corte Logicor comprising a Bilbao for €170 million.
Deals Inglés for €135 million. portfolio of six logistics
warehouses in Madrid.
Volume €295 million,
yield close to 4%.EMEA Capital Markets Snapshot | Q1 2022
Italy Sectors
to watch
Q1 Pricing
Direction
Q2 Pricing
Forecast
Logistics Office
Activity in Q1 reached a record volume of €3.1 billion. This was achieved largely thanks to (Southern Italy)
the closing of the Project Dream portfolio, but was also driven by increasing activity in all
Residential Logistics
asset classes, especially the office sector. (main large cities)
Residential
Market Review
Retail
• The Italian market started to post strong • Core opportunities are preferred but value-add
performance in H2 2021 and this trend is continuing operations have started to close again. Two office Hotel
in 2022. Activity in Q1 was high and we expect other deals are noteworthy: Project Dream and the A2A
deals to be closed in the coming months. portfolio. The first is a mixed portfolio with assets
mainly in Milan, but also Rome, Florence and Latina. All sector capital value index
• All asset classes registered higher volumes
The second consists of three offices that will be
compared to Q1 2021. The office sector again took 160
liberated in the next two years and boast strong
first place with important deals closed in Milan and
refurbishment potential.
Rome. Logistics remained a sought-after asset class, 140
with deals closed in the Centre-North. Investors are • Other deals included important value-add
still looking at assets in the South, without closing operations in the living asset class. Institutional 120
any deals yet. investors are beginning to enter this market,
traditionally dominated by local players focused on 100
build to sell (BTS), and private landlords renting units
to students/young professionals or local families. 80
03’17 09’17 03’18 0918 06’19 09’19 06’20 09’20 06’21 09’21 03’22
Source: Colliers Rome Milan
Silvio Sancilio | Head of Capital Markets
Office/Retail/I&L/Hotel/ Logistics: Verona DC1 Office: A2A portfolio – silvio.sancilio@colliers.com
Highlighted Living: Project Dream – in Nogarole Rocca (VR) - €221m, 3 assets bought by +39 338 7469372
Top Three €842m, 68 assets bought €117m, bought by LaSalle Henderson Park (Value-
Deals by Apollo (mainly value- Investment (core at 4%). add).
add).EMEA Capital Markets Snapshot | Q1 2022
Sweden Sectors
to watch
Q1 Pricing
Direction
Q2 Pricing
Forecast
As of early 2022, the Swedish market remains strong in terms of both volume and pricing. Logistics, Office
Total transaction volume for Q1 2022 amounted to €4 billion, a 22% increase from residential, office
the same quarter of the previous year. and public sector
Logistics
properties.
Market Review
Residential
• Although Sweden had a slow start to 2022, with • The industrial and logistics sector continues to be
another stay-at-home order and geopolitical a focus of intense investor interest. In addition, Retail
uncertainty amongst our European neighbours, there is solid and most likely growing investor
we have continued to see a performing and interest in offices and defensive retail subsectors
Hotel
transacting investment market. We expect the such as grocery stores and big box budget retail.
next quarter to remain strong, but potentially Residential remains the most expensive property
not as strong as the second quarter of 2021 since type as yields have continued to compress,
All sector capital value index
interest rates have started to rise. Interest rate deterring some investors.
considerations have yet to really impact and flatten 160
• Social infrastructure company SBB continues its
the price growth.
growth. It signed as the buyer in two of the largest
140
transactions in Sweden during the first quarter
of 2022. SBB ranked as the fifth largest property
120
owner in Sweden in 2022.
100
Portfolio deal: SBB Mixed-use: SBB won Office: Regio (owned by 80
Highlighted sold three properties to the battle for a major the Third AP Fund and 03’17 09’17 03’18 0918 06’19 09’19 06’20 09’20 06’21 09’21 03’22
Top Three Swedish Government opportunity offered by Brunswick Real Estate) Source: Colliers Stockholm
Deals Buildings, a JV that SBB Kalmar municipality. For signed an agreement with
owns in equal parts €258 million, Castellum to acquire a
with Kåpan Pensions. SBB acquired 24 portfolio of 12 centrally
The properties include properties with a total located office properties
tenants such as the of 136,000 sq m. The in Gävle. The purchase
Daniel Gorosch | CEO & Head of Capital Markets
Police Authority and portfolio includes several price amounts to €232
daniel.gorosch@colliers.com
the Swedish Courts modern office buildings, million, which is Regio’s
+46 761 48 51 03
Administration. The a large school, a new single largest acquisition
properties sold for sports hall, and the county ever.
€261 million. administrative board’s
beautiful office.EMEA Capital Markets Snapshot | Q1 2022
Denmark Sectors
to watch
Q1 Pricing
Direction
Q2 Pricing
Forecast
Residential – Office
The property market is expected to remain relatively stable and to be characterised by in particular
continued high activity following the lifting of all COVID-19 restrictions in Denmark. affordable
Logistics
housing and
micro living
Residential
Market Review Prime core and
value-add office
• So far, 2022 has seen strong appetite from • International investors are increasing their share Retail
domestic and international investors alike. The of investment volume as they perceive the Danish Logistics
Danish market is expected to stay buoyant despite investment market to be a safe haven. Four of the Hotel
the uncertainty caused by the war in Ukraine, five biggest transactions in the quarter stemmed
given the security provided by its status as a NATO from international investors.
member state. All sector capital value index
• Rising inflation and spiking interest rates have 160
created uncertainty in the market, as has the
Ukraine crisis. Despite this, activity remains 140
exceptionally brisk in the market for Danish
commercial and investment properties, with 120
considerable demand from both domestic and
international investors. 100
80
03’17 09’17 03’18 0918 06’19 09’19 06’20 09’20 06’21 09’21 03’22
Source: Colliers Copenhagen
Residential: On behalf Retail: A Swedish Industrial & logistics:
of a sovereign wealth property company The British investor
Highlighted fund, an international acquired a portfolio of 35 Promontoria Logistics
asset manager acquired retail properties, mainly acquired a secondary Peter Winther | Executive Director &
Top Three
a 30,000 sq m residential supermarkets, for 111,000 sq m industrial Head of Capital Markets
Deals peter.winther@colliers.com
portfolio in suburban €280 million. and logistics portfolio at
Copenhagen. The €80 million, reflecting +45 28 19 66 76
net initial yield was a net initial yield of
approximately 3.65%. approximately 6.5%.EMEA Capital Markets Snapshot | Q1 2022
Czech Republic Sectors
to watch
Q1 Pricing
Direction
Q2 Pricing
Forecast
Investor sentiment and market momentum gained in Q4 of 2021 and this continued into Residential - PRS, Office
the first quarter of 2022, with transaction volumes at a level not seen for some time. Initial industrial, core
indications are that recent geopolitical and economic inflationary events do not appear to have offices
Logistics
had a detrimental impact on pricing as yet, although every crisis has its winners and losers.
Residential
Market Review
Retail
• Q1 2022 saw transaction volumes of over €900 • Surprisingly, investors returned to the retail sector
million in just one quarter, equivalent to 50% of in Q1. Shopping centre transactions included
Hotel
the previous year’s total volume. This is in part a the disposal of Géčko in České Budějovice by CPI
result of some transactions completing later than PG and the sale of two shopping centres in Brno
projected, having been postponed from last year. Avion Shopping Park, and to Polish and Slovak
All sector capital value index
Such levels of liquidity have not been seen since investors respectively. This is the first time we
2019. We project that investment volumes will be have seen Polish investors acquire retail assets in 160
lower in Q2. the Czech Republic, reversing the trend of capital
flowing from the Czech Republic to Poland. 140
• Investor appetite for prime industrial assets
remains unabated, but with limited suitable
120
investment product, investors must react
quickly to opportunities and where necessary
100
be prepared to pay a premium for assets. Office
schemes, as was seen this quarter, remain
80
popular and if the asset is of good quality with 03’17 09’17 03’18 0918 06’19 09’19 06’20 09’20 06’21 09’21 03’22
a reasonable WAULT in place, then it is likely to
Source: Colliers Prague
attract strong investor interest, particularly in
Prague which remains a key focus for investors.
Mark Richardson | Director, Head of Industrial and
Retail: Sale of CPI PG Office/Retail: Bořislavka Industrial: Hines acquired Investment Services
Shopping centre portfolio brand-new mixed-use an industrial portfolio mark.richardson@colliers.com
Highlighted
(two properties) to development was sold to from CPI PG of smaller +420 734 235 037
Top Three
Slovakia’s 365.invest for Reico for an estimated parks around Prague for
Deals
over €200 million. price exceeding over €100 million.
€180 million.EMEA Capital Markets Snapshot | Q1 2022
Romania Sectors
to watch
Q1 Pricing
Direction
Q2 Pricing
Forecast
2022 started on a decent note volume-wise, with some delays to or renegotiations of large Prime offices, Office
industrial assets
deals taking place amid the war in Ukraine, though the good news is that deal making has not
stopped. Logistics
Residential
Market Review
• Close to €90 million of commercial real estate • The inflationary backdrop continues to favour a Retail
assets traded in the first quarter of 2022, down capital shift towards real estate in general, given
some 9% compared to a year ago. Offices its perceived status as an asset class hedged
Hotel
accounted for over 70% of dealmaking activity, against CPI spikes. That said, the war in Ukraine is
with the quarter’s biggest deal seeing Speedwell causing some issues, with some deals (particularly
selling the mixed-use Record Park in Cluj-Napoca those involving big-ticket items) seeing delays
All sector capital value index
(with offices generating the bulk of the value) to or even renegotiations, though, positively, deal
AYA Properties Fund for €35 million. making is not frozen. 140
• The retail sector generated the quarter’s • The pipeline for Romania remains office
second biggest deal, which saw Revetas Capital heavy, with logistics transactions still failing to 120
selling Vitantis Shopping Center, a retail park underscore the true scope of demand given that
in Bucharest, to Praktiker Real Estate; this deal many landlords are either long-term owners or
represented some 20% of Q1 turnover. are still holding onto their assets in the hope of 100
getting more favourable terms in the coming
quarters.
80
03’17 09’17 03’18 0918 06’19 09’19 06’20 09’20 06’21 09’21 03’22
Source: Colliers Bucharest
Office: Record Park, a Retail: Revetas Capital Office: The third biggest
new office project in Cluj- sold Vitantis Shopping deal of the quarter saw
Highlighted Napoca, was sold by its Center in Bucharest to Hungarian group Indotek
Robert Miklo | Head of Capital Markets
Top Three developers (Speedwell and Praktiker Real Estate; purchase an office project
robert.miklo@colliers.com
Deals Baltisse) to AYA Properties ticket size estimated in the in the north of Bucharest
+40 21 319 77 77
Fund for €35 million. region of €20 million. (Baneasa Business Center)
in a deal estimated in the
€15 million region.EMEA Capital Markets Snapshot | Q1 2022
Hungary Sectors
to watch
Q1 Pricing
Direction
Q2 Pricing
Forecast
Total investment volume (excluding development plots) reached €142 million in Q1 2022, Both core Office
down 38% year-on-year. The office sector continued to attract the majority of investment and value-add
offices in the
volume with a total of €111 million, representing 78% of the quarter’s investment volume. Logistics
right locations,
logistics and
Market Review Residential
hotels
• The remainder of the activity (22%) was in the • Pricing of non-prime assets will likely remain under
industrial & logistics sector. No transactions were pressure, given increased vacancy rates among Retail
registered in the hotel or retail sectors during the B-class properties, stagnating rents and higher
quarter. The average deal size was €24 million, and fit-out costs, which have a negative effect on net Hotel
local investors were behind most of the volume. effective rents.
• A major push is expected in the development of • Prime offices have demonstrated that they will
industrial & logistics facilities in 2022, while some remain the key drivers of Hungary’s property All sector capital value index
new offices will also be handed over during the investment market for years to come, despite 180
year, driving deals in the office sector. Prime offices the headwinds presented by new hybrid working
remained mostly stable in value, whilst the pricing trends within the occupier market as a result of the 160
of prime logistics has risen further. Typical prime pandemic. The growth in demand has accelerated
140
yields at the beginning of 2022 were 5-5.25% in the most markedly in the industrial & logistics sector
office sector and 5.75% in the modern industrial since the onset of the pandemic, which has also 120
& logistics sector. Chinese and South-Korean resulted in strong capital appreciation in this
100
investors are especially interested in the industrial sector.
& logistics sector, as well as the office sector. 80
• With Hungary’s COVID-era loan moratorium
03’17 09’17 03’18 0918 06’19 09’19 06’20 09’20 06’21 09’21 03’22
expiring, we forecast more forced sales in the
hotel market. Source: Colliers Budapest
Office: Europa Capital, Office: R70 was acquired Industrial: M7 Real Estate
together with local partner by Épkar Zrt. (10,300 sq purchased Akácliget Bence Vecsey | Director, Head of Investment
Highlighted
ConvergenCE, acquired the m) from CA Immo in the logistics centre from bence.vecsey@colliers.com
Top Three Akadémia Business Center Central Pest submarket Phoenix Fund (18,000 +36 1 336 4200
Deals (12,500 sq m) in the CBD for €30 million. sq m) on the outskirts of
submarket of Budapest for Budapest.
€47m.EMEA Capital Markets Snapshot | Q1 2022
Poland Sectors
to watch
Q1 Pricing
Direction
Q2 Pricing
Forecast
Office, logistics/ Office
With a total preliminary volume of €1.5 billion (a figure still to be adjusted upwards following industrial, PRS
the late closing of several industrial and logistics transactions) Q1 2022 represented a Logistics
significantly improved performance compared to Q1 2021, with pandemic restrictions being
lifted and the injection of new capital into the market. Momentum is expected to persist Residential
despite the war in Ukraine weighing on investor sentiment to some degree.
Retail
Market Review Hotel
• Despite ongoing turbulence, the market is still • Rental growth in both offices and logistics is
active with a number of new buyers entering. finally on the horizon and the market is already
All sector capital value index
witnessing first instances of developers increasing
• CEE-based capital is expected to be one of the
rents, as well as incentive packages decreasing. 140
market-makers in 2022 amid established Western
investors adopting a more selective approach due • Several major preliminary agreements were signed
to the Russian invasion of Ukraine. for office assets in particular, which will be reflected 120
in volumes in the following quarters.
• Industrial & logistics assets are still in the highest
demand, however demand for offices is coming
100
back due to supply and demand dynamics, in
particular an inflow of new occupiers as well as
rapidly increasing construction costs. 80
03’17 09’17 03’18 0918 06’19 09’19 06’20 09’20 06’21 09’21 03’22
Source: Colliers Warsaw
Office: €583 million Retail: €650 million – A Industrial: €71 million –
/ 4.5% - Google’s delisting of one of CEE’s Acquisition by Partners
acquisition of the Hub, leading retail landlords, Group and Peakside of
Highlighted Piotr Mirowski | Senior Partner, Head of Capital Markets
a Class A Warsaw office followed by restructuring Cromwell’s prominent
Top Three piotr.mirowski@colliers.com
tower, proved to be of ownership with Warsaw portfolio.
+48 512 233 228
Deals one of Europe’s largest Redefine Properties, the
single-asset transactions second largest REIT listed
in the last 12 months. on Johannesburg’s stock Dorota Wysokinska-Kuzdra | Senior Partner
exchange, taking control. dorota.wysokinska-kuzdra@colliers.com
+48 661 380 570EMEA Capital Markets Snapshot | Q1 2022
Contacts
For more information please use the contact details below:
EMEA Team Local research leads
Christian King Josef Stanko Silviu Pop
Client Services, Cross Border Capital Markets | EMEA Research Analyst | Czech Republic Head of Research | Romania
+44 7981 704448 josef.stanko@colliers.com silviu.pop@colliers.com
christian.king@colliers.com +420 728 175 024 +40 21 319 77 77
Damian Harrington Emil Helmsøe-Zinck Madeline Buijs
Director, Head of Research | Global Capital Markets & EMEA Head of Valuation and Advisory | Denmark Head of Research & Economy | Netherlands
+44 7867 360489 emil.helmsoee-zinck@colliers.com madeline.buijs@colliers.com
damian.harrington@colliers.com +45 30 23 96 41 +31 6 10 97 17 86
Istvan Toth Laurence Bouard Jorge Laguna
Director, Research | EMEA Head of Research | France Business Intelligent Director, Head of Research | Spain
+44 20 7487 1899 laurence.bouard@colliers.com jorge.laguna@colliers.com
istvan.toth@colliers.com +33 6 81 56 49 02 +34 654 387 110
Susanne Kiese Dr. Walter Boettcher
Head of Research | Germany Head of Research and Economics I UK
susanne.kiese@colliers.com walter.boettcher@colliers.com
+49 151 55110942 +44 20 7344 6581
Simone Roberti Gertrúd Hausenblasz
Head of Research | Italy Research Analyst | Hungary
simone.roberti@colliers.com gertrud.hausenblasz@colliers.com
+39 348 3806762 +3670 702 8626EMEA Capital Markets Snapshot | Q1 2022
The world of Colliers
View our other recent
Market Snapshots
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images:
€3.5B 62 €45B APAC
Assets under Coming soon
Annual revenue Countries
management Coming soon
53,000 185M 17,000
Professionals North America
Lease/sale Square metres Coming soon
transactions managed
Statistics are for year-end 2021 and in EUR. Number of countries includes affiliates and as of March 2022.
Data Disclaimer
This report gives information based primarily on Colliers data, which may be helpful in anticipating trends in the property sector. However, no warranty is given as to
the accuracy of, and no liability for negligence is accepted in relation to, the forecasts, figures or conclusions contained in this report and they must not be relied on for
investment or any other purposes. This report does not constitute and must not be treated as investment or valuation advice or an offer to buy or sell property.
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