Many experts who suggested that that because of Germany’s stability, both in terms of its economy and its property market, which had performed solidly if unexcitedly in the last 5 years, would fall less than almost all the other EU countries have been proven correct. As a result the €10bn of German commercial property transactions in 2009 accounted for over 27% of the entire EU commercial transactions.
Q1 2010 saw €4.2bn of commercial property transactions in Germany amongst them was the sale of the ALEXIA retail centre in Berlin for €310m as well as rumors that the Sony building will be sold later this year for c €570m.
These purchases signal that Germany remains high on the radar for institutional investors are conservative purchasers whose primary focus remains targeted towards income producing property.
Accountant Ernst & Young predicts that Germany will receive a large proportion of 2010 investment funds and investment volumes will rise by 60 – 80% to 16 – 18bn in 2010.
BVI, the German association of property funds, reports that their members have a war chest of c. €7.8bn in equity reserves available to spend between 2010 and 2011.
The influential PWC Emerging trends in Real Estate Europe 2010 report, includes four German cities in the top ten of the 27 EU cities they rank for investment prospects. These cities were Munich 1st, Hamburg 2nd, Berlin 8th and Frankfurt 9th. The Greenman AUTO fund currently own properties in both Hamburg and Berlin.
Click on the image opposite to download a detailed analysis of the German Commercial Property Market and how it might fare in 2010.
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Further Reading
Price Waterhouse Coopers (PWC)AFIREErnst & Young
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