Office
The first quarter of 2021 continues to suffer from the effects of the Covid-19 pandemic in terms of absorption figures, although a physiological reduction was predicted. In Milan, total transacted volume recorded a 30% decrease compared to the first quarter last year, however, the office market remains dynamic with a growing interest for medium-small size spaces. Take-up in Rome increased by 40% YoY, but this was due mainly to the completion of a pre-let signed in 2018 for circa 16,000 sqm in the Centre submarket; excluding this transaction, figures recorded a 10% decrease from Q1 2020 with demand mostly concentrated on smaller floorplates. Investments are expected to increase during the second part of the year with both core and value-add transactions. As companies continue to study what the “new normal” will be, a reduction in overall occupied space is predictable as WFH increases.
Retail
Support measures drawn up by the Government limited the decline in household’s disposable income, but consumption is still suffering since household spending is partly held back by fears of the pandemic or by the restrictions themselves. Retail, both high street and shopping centres, experienced lower performances, due to restrictions and to the lack of tourism and workers. Occupiers’ attitude remains cautious, especially for F&B and entertainment, the most affected sectors by the pandemic. Investors are still cautious towards the retail sector, since it is still highly impacted by containment measures, and are waiting to see if in the next months retailers will perform at the same levels as in June-October 2020 when restrictions were lifted.
Industrial
During the first quarter of 2021 the Italian logistics market continued to be dynamic, with an high absorption level and a robust pipeline. The strong occupier demand, a more diversified market, the amount of equity allocated to the sector together with the scarcity of product, led investors to expand their strategies to include a more speculative approach as well as value add acquisitions. The outlook continues to be positive, with a sparkling demand for logistics spaces. Italy remains a country of strong interest as prices are lower than in other mature countries. The situation of the global economy is highly uncertain, due to the Covid-19 emergency, and the outcomes are hard to predict. As the situation will become clearer in the following months, information and related predictions will become more reliable
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