Tag Archives: france
French commercial real estate investment up 10% in third quarter
Investment volumes in the French commercial real estate market are set to exceed €15 billion, a 10% increase compared to the same period in 2013, according to the latest industry report. The latest research report from covering the third quarter of 2014 estimates that the year-end total investment volume for the French market will reach €21 billion, which is a 19% rise on the figure recorded at the end of 2013. Savills notes that these increased transaction volumes have been driven by larger transactions over €500 million with 2014 already seeing five deals in this bracket take place with none recorded above this figure in 2013. The volume of portfolio deals in France has also risen by 58% against the first three quarters of 2013. While other European cities, such as the UK, have seen investor demand move out to more regional cities, Savills research shows that investors in France continue to concentrate on Paris IDF, which has so far this year seen 67% of the national investment volume. When analysing specific market sectors, Savills found that offices continued to dominate accounting for 56% of the total investment volume in France so far this year. However, the firm highlights that the share of retail assets is growing and now accounts for 26% of the investment volume compared to 18% previously. The share of retail portfolio sales has also been boosted this year by the Carrefour acquisition of 57 shopping centres for €1.98 billion which is the biggest deal recorded this year. In terms of demand, Savills confirms that overseas investors have increased their appetite for commercial real estate in France accounting for 43% since the beginning of the year, which is an 8% increase on the same period in 2013. US equity funds have been particularly active with Lone Star acquiring Coeur Defense for €1.3 billion in what was the second largest transaction recorded this year. Savills notes that Middle Eastern investors were also prominent representing 9% of total investment transactions in France compared with 7% in 2013. ‘While we have seen an increase in appetite from overseas investors in France, it is important to note that this is mainly for big ticket and landmark buildings with domestic investors remaining far more active in terms of the number of overall deals done,’ said Boris Cappelle, director of investment at Savills France. Lydia Brissy, director of Savills European Research, expects international investors to continue to expand their activities in France, particularly Asian funds from China. ‘As a result of this more competitive market for prime assets, we predict that the prime office yields could harden by 20bps taking them to 3.6% by the end of the year,’ she explained. Continue reading
Sales up over 50% year on year in prime Alpine resorts
The prime ski property market in the Alps is continuing on its upward path with sales volumes up 52% year on year, according to the latest index from Savills. More alpine sales are taking place at lower price points as the resilience of the ultra-prime markets starts to ripple down the market ladder, according to the report. ‘A year ago we predicted prolonged periods of sunshine and blue skies for the Alpine property market. This may have been a somewhat easy prediction, given a recovering world economy, increased confidence and job security and in the case of UK buyers, a steady strengthening of sterling,’ said Jeremy Rollason, managing director, Alpine Homes. ‘The Alpine property market however continues its upwards trajectory in terms of increasing sales volumes, up 52% year on year, although this does not necessarily mean rising prices,’ he explained. ‘While buyers are more prolific for the above reasons, prices in the Alps have not generally kept pace with house price increases back in the UK, particularly in London,’ he added. The index report points out that Switzerland’s position outside the European Union cements is appeal as a safe haven for wealth and as such resorts carry a price premium. In the case of Verbier, values can reach €22,400 per square meter or 80% more than the average. It’s therefore no surprise that five Swiss resorts, Gstaad, St Moritz, Zermatt, Verbier and Crans Montana, appear in the Savills Top 10 Ultra-Prime Resorts Index. The family friendly resort of Saas Fee stands out as offering a long season with good quality snow but with comparatively lower priced property at averages of between €4,000 and €8,000 per square meter. ‘Verbier and The Four Valleys remains ever popular and is the destination of choice for many international buyers. Supply restrictions with the new Lex Weber law limiting the number of second homes to no more than 20% of the total will begin to bite in the next one to two years, once existing supply is absorbed. Upwards price pressure in the leading Swiss resorts is inevitable, although there are still deals in the resale market for those that shop around,’ he added. Austria’s comparative affordability, dual seasonality, diverse culture and attractive rental returns make it the country of choice for those chasing bang for their buck. Indeed, rental returns of ski property in Austria are roughly double those of either France or Switzerland, at circa 5% to 7% gross. Kitzbuhel is the only Austrian resort included in the Savills Top 10 Ultra Prime Resorts Index where prices range from €8,000 per square meter to €15,000 per square meter. For buyers seeking value, Bad Gastein and Zell am See offer lower priced property and average ski conditions, although the latter boasts a particularly strong summer season. The resort of Ischgl, the Ibiza of the Alps, is highlighted as one to watch. Prices here are under €4,000 per square meter. Stability is… Continue reading
Number of foreign buyers in Paris region rises as French look to Spain
Foreign buyers are increasingly snapping up properties in and around Paris with new figures showing they account for almost one in 10 sales. In the three districts that make up the Ile de France some 9.2% of buyers were from overseas, the first time such a number of sales has been seen for 15 years. The figures from real estate group Bien, said that there has been a big shift in where buyers are coming from. Italian, Chinese, Algerian and Portuguese buyers make up the bulk of sales to overseas buyers. But overall the number of foreign buyers has remained stable with fewer French people buying homes in the region, according to the firm. In Paris itself, some 8.3% of buyers this year have been foreign nationals, with the figure rising to 11.2% in the Inner Ring and dropping to 7.5% in the Outer Ring. Four years ago, foreigners made up just 6.3% of the sales total in the region. Italians accounted for the largest foreign group in Paris, with 17% of sales. Chinese buyers dominated the foreign market in the Inner Ring with 22.2% of sales while Portuguese buyers came out tops in the Outer Ring at 29%. It is not a case of foreign buyers moving to France. The data shows that some 90% of these buyers were already resident in the Paris region. Meanwhile, another report suggests that the French are buying more property in Spain. Some 18.2% of foreign buyers in Spain are French and 51% of enquiries are within an hour’s drive of Spain, according to the latest data from Spanish property portal Kyero. It means that the French are now the second largest group of foreign buyers of Spanish property. British buyer are still top at 54.5 and in third place is Germans at 7.5%. A multitude of economic factors over the past year have encouraged more and more French buyers into Spain, according to Martin Dell, Kyero director. ‘With the French property market looking pretty flat, many are casting their eyes further south in search of holiday home bargains that can satisfy both investment and lifestyle requirements,’ he explained. ‘Property in Spain is incredibly cheap right now and for French buyers, being part of the Euro, means that the headache of currency exchange is removed from the purchase process,’ he said, adding that the north of Spain is particularly popular due to it being easily accessible. Kyero figures show that Girona, just 55 minutes' drive from France accounted for 51% of enquiries, followed by Castellon at 46%, Tarragona at 29% and Cantabria at 25%. Continue reading
