European MarketBeat Snapshots (Sector Bundles) Q1 2015 - Cushman & Wakefield

European MarketBeat Snapshots (Sector Bundles) Q1 2015

The European MarketBeat Snapshots are brief summaries of the office, retail, industrial and economic sectors in Europe's markets. They provide commentary on recent sector trends, display current market data and analyse the impacts on commercial real estate. For your convenience, our European MarketBeat Snapshots have been bundled by sector, allowing for easy access and understanding of what is driving Europe's key markets for each real estate and economic sector.

What do our industry experts have to say about the European commercial property market performance in Q1 2015?

RETAIL:

“The European retail market remained vibrant in Q1, with occupational demand bolstered by a rise in consumer spending and a notable increase in enquiries from overseas retailers seeking opportunities to open their first store on prime retail thoroughfares. Western Europe saw the biggest y/y increase in prime high street rents at 2.9%, boosted by a positive performance in markets such as Italy which took the top 3 spots for highest rental growth in WE (Rome, Milan and Venice). “In addition, the luxury high street market saw another strong performance with the entrance of new international retailers opening their first stores in premium locations – e.g. Tory Burch in Paris (Rue Saint-Honoré).”

Justin Taylor, Head of EMEA Retail

OFFICES:

“After significant activity at the end of 2014, leasing activity slowed in Q1 but was still healthy, reaching almost 3 million sq.m with most European office markets seeing improved levels of occupier activity from both existing companies reactivating their shelved expansion plans and new requirements. Dublin led the way in terms of rental growth (+11.6%), with new demand creating a bottle neck against a lack of adequate supply and a low development pipeline. London also saw increased activity as demand outstripped supply, with rents rising in all parts of the UK capital. Moscow, on the other hand, was more subdued due to sanctions and the falling value of the rouble, with occupiers choosing to renegotiate their leases on more competitive terms.”

James Young, Head of EMEA Offices

INDUSTRIAL:

“The general lack of available quality stock across key markets in Europe is limited and a challenge to occupiers looking for space. As a consequence much development activity has been focused on built-to-suit schemes which is the only alternative to companies establishing their operations. The result of this type of activity is the start of limited speculative development in some markets. While not a new story, the continued rise of online retailing is driving a large proportion of current demand. Over the year to Q1, Western Europe performed better in terms of rental growth than Eastern Europe, the latter largely dragged down by rental falls in Russia.”

Mark Webster, Head of European Logistics & Industrial