RICS Global Commercial Property Survey RICS Economics Q1 2009
www.rics.org
Global rental declines to gather pace • • • •
Price falls accelerate in most emerging markets Rental downturn expected to gather pace Emerging Europe sees weakest occupier activity Upward yield shift gains speed in Japan and US.
Change in rental expectations
Balance of respondents,% 2008 2nd Qtr
100
2008 3rd Qtr.
rents expected to rise
2008 4th Qtr.
2009 1st Qtr.
75 50
0 -25 -50 -75
Confidence towards the rental outlook has been revised down in the latest survey. Sentiment is bleakest across Developed Asia and Emerging Europe. As such, agents are offering greater incentive packages to secure a letting across all regions. Hong Kong , Singapore, Ukraine, Russia and Hungary are among the countries expected to see the biggest rental declines in the quarter to June. The pricing outlook broadly mirrors the rental trends with only Brazil and parts of Africa expected to avert falling prices. Across all developed regions both lettings and investment demand fell at a less pronounced pace although the pricing environment was little improved. The pace of price falls accelerated in North America and Emerging Europe although the sharpest reported declines were in Developed Asia for the second consecutive quarter.
RICS Americas T +1 212 847 7400 ricsamericas@rics.org
RICS Asia Pacific T +852 2537 7117 ricsasiapacific@rics.org
RICS Oceania T +61 ( 2 ) 92162333 info@rics.org.au
RICS Middle East & Africa T +971 ( 4 ) 375 3074 sluthria@rics.org
le idd
Am ti n
M
La
Ea
As d pe & a ri c Af
In Western Europe, Germany remains the outperforming market with expectations towards property values less pessimistic than elsewhere. Sentiment towards rents is worst in the Republic of Ireland , Spain, France and the UK. The outlook towards prices for the second quarter is most negative in the Netherlands, France and Ireland. The Japanese and US real estate markets continue to deteriorate with virtually all respondents to the survey reporting falling capital values. Globally, the upward shift in yields has moderated across most regions although it increased in pace in the US and Japan. Expectations are that yields will be relatively more stable in Australasia , Latin America, Africa and the Middle East in the second quarter.
56 58 H2 2005 55 57 H1 2006 58 55 H2 2006 41 39 H1 2007 16 9 H2 2007 39 14 Q1 2008 Q2 2008 -37 -17 Q3 2008 -56 -39 Q4 2008 -78 -72 Q1 2009 -56 -51 ** Balance = Proport ion of surveyors report ing a rise in prices m inus t hose report ing a f all (if 30% report ed a rise and 5% report ed a f all, t he unadjust ed balance w ill be 25%) Total number of survey contributors =
RICS Europe T+32 ( 2 ) 733 1019 ricseurope@rics.org
rents expected to fall
The Middle East saw activity declines accelerate further with tenant demand and rental expectations falling at a faster pace. Available space is rising sharply in the UAE with the office sector seeing the biggest pick up in reported availability.
Gl obalcom m er ci alpr operty I nvestm ent Tenant Rent s dem and dem and ---------Net Balance - Not Seasonally Adjust ed----------
RICS UK ( press office ) T +44 ( 0 ) 20 7695 1682 sthornton@rics.org
st
ia
ic a lo ve
No
r th
ng gi er Em
De
Eu
Am
ro
er
pe
ia As gi er
Em
rn te es W
Rents are falling across more than 90% of the countries surveyed with only Brazil, Saudi Arabia and parts of Africa, yet to report declines. Indeed , available space is rising across every global region dampening rental expectations of real estate professionals.
ng
Eu
ra
ro
la
pe
si a
-100
Au
Prices continued to decline across the developed economies although at a lesser pace with only North America seeing sharper falls. Tenant demand fell across all global regions however, the magnitude of the fall in aggregate has moderated.
25
st
The latest global commercial property survey from RICS shows that the pace of decline in capital values accelerated during the first quarter driven by steeper falls in prices across most emerging markets.
Yields
44 48 56 58 46 14
49 40 34 23 13 28
2 -12 -50 -66
32 43 60 63
361
RICS HQ 12 Great George Street Parliament Square London SW1P 3AD T +44 ( 0 ) 20 7334 3774 F +44 ( 0 ) 20 7334 3795 economics@rics.org.uk
RICS Global Commercial Property Survey RICS Economics Q1 2009
www.rics.org
Real Capital Analytics guest article: Balance of property trading tips homeward Global capital has withered with extraordinary consistency around the world, vanishing almost entirely from the Americas and Asia Pacific and retaining a slim presence in EMEA. By contrast, investment capital from local sources has become ever more important and now comprises by far the largest single investment source in all three global zones, although still fading in volume. Cross-border investment, whether global or continental, was buttressed by the decoupling theory of diversification. This held that emerging economies had become strong enough to stand on their own in a downturn among developed nations. But the drastic global reversal of the past two quarters has effectively neutered that argument. Instead, the conquistador investors who had roamed far afield searching for higher returns have begun seeking investments in their own countries. The lure of home? Distress, looming globally, holds potential for low entry prices and high returns. In 2008, global cross-border investment was $82b, off $107b and 57% from 2007. Continental investment stood at $80b, down 60% from $201b the previous year.
Through mid-2008, global and continental investors played a more significant role in EMEA than in any other zone, buoyed especially by investment from the US—the leading global exporter of capital. The drought of global investment that set in last fall could hit European property markets particularly hard. Even continental investment in EMEA, which had been fed by single-currency Western Europe and relatively high cap rates in Eastern Europe, will show a greater proportional loss as investors increasingly take a domestic focus.
RICS represents 140,000 members worldwide. These professionals provide expert advice on land, property, construction and the associated environmental issues. An independent, not-for-profit organisation, RICS acts in the public interest, upholding standards of competence and integrity among its members and providing impartial, authoritative advice on issues affecting business and society.
Net investment from global capital has decreased most significantly in Asia Pacific, falling from $52.6b in 2007 to $23.2b last year and dropping off precipitously last spring. Local investors, although cutting back acquisition volume, will continue to grow their profile in AsiaPac: their investment activity grew from 55% in 2008 to 72% for all deals in q1’09. The capital markets in this still emerging zone, despite huge strides in recent years, remain—for now—less evolved than those in the Americas and EMEA.
Conversely, local investment capital will play a stronger role in the Americas, where US community and regional banks have been less damaged by the global financial crisis. Investment capital for export will continue shrinking in the US, benefiting local and national property markets. Investors in other major capital exporting nations will also be in a better position to take advantage of investment opportunities at home than net importers of capital. Especially exposed are the BRIC countries as foreign investment capital withdraws. One anomaly: the UK. With real estate values there already battered and the pound weakening, the country may actually be looking attractive, particularly to European investors who can arbitrage the currency and take advantage of still correcting prices.
This article has been written Real Capital Analytics and represents the views of RCA only. Real Capital Analytics is a global research firm based in New York City. The firm's proprietary research is focused exclusively on the investment market for commercial real estate.
The RICS Global property guide is a quarterly publication which aggregates the views of commercial property professionals including RICS members, 2 researchers, fund managers, agents across the world. To participate in this survey four times a year please email globalproperty@rics.org to register your email address.
RICS Global Commercial Property Survey Country statistics - Expectations for Q2 2009 Confidence towards rents in Q2 ranked by net balance scores -100
-80
-60
-40
-20
0
So uth A frica B razil Cro atia Thailand Saudi A rabia Switzerland P hillippines Czech Republic A rgentina Luxembo urg Co lo mbia Italy B ulgaria Vietnam So uth Ko rea China Turkey Germany P o rtugal The Netherlands Scandinavia M alaysia P o land UK Canada B elgium France New Zealand Japan Spain India A ustralia Russia US UA E Ro mania Ukraine Hungary Republic o f Ireland Ho ng Ko ng Singapo re
3
20
40
60
80
100
RICS Global Commercial Property Survey Country statistics - Expectations for Q2 2009 Confidence towards capital values in Q2 ranked by net balance scores -100
-80
-60
-40
-20
0
B razil A rgentina Germany B ulgaria Vietnam So uth A frica China Turkey Luxembo urg Co lo mbia Saudi A rabia Spain India Czech Republic UK Switzerland P hillippines Thailand US New Zealand M alaysia P o land UA E Italy Ro mania P o rtugal B elgium So uth Ko rea Ukraine A ustralia Ho ng Ko ng Canada Republic o f Ireland Scandinavia Hungary Russia Japan France The Netherlands Singapo re Cro atia
4
20
40
60
80
100
RICS Global Commercial Property Survey Regional statistics— Expectations for Q2 2009 Expected Tenant Demand
-100
-80
-60
-40
-20
0
20
Expected Yields
40
60
80
-100
100
Australasia
Australasia
Western Europe
Western Europe
Emerging Asia
Emerging Asia
For Q3 For Q4 For Q1 For Q2
Emerging Europe
North America
Africa & Middle East
Africa & Middle East
Latin America
Latin America
-80
-60
-40
-20
0
20
40
60
80
100
-100
Australasia
Western Europe
Western Europe
Emerging Asia
Emerging Asia
North America
-20
0
20
40
60
80
100
For Q3 For Q4 For Q1 For Q2
Expected Capital Values
Australasia
Emerging Europe
-40
North America
Developed Asia
-100
-60
Emerging Europe
Developed Asia
Expected Investment Demand
-80
Emerging Europe
For Q3 For Q4 For Q1 For Q2
North America
Developed Asia
Developed Asia
Africa & Middle East
Africa & Middle East
Latin America
Latin America
5
-80
-60
-40
-20
0
20
40
60
80
100
For Q3 For Q4 For Q1 For Q2
Lettings market activity Tenant demand How has tenant demand changed in the last 3 months compared to the previous 3 months in terms of quantity of space leased and sold to occupiers?
Change in tenant demand
Balance of respondents,% 2008 2nd Qtr
100
2008 3rd Qtr.
tenant demand rising
2008 4th Qtr.
2009 1st Qtr.
75 50
reporting a fall (if 30% reported a rise and 5% reported a fall, the unadjusted
Am La tin
es te rn
W
* Balance = Proportion of surveyors reporting a rise in prices minus those
Ea st
-40
id dl e
-37
Latin America
tenant demand falling
M
Africa & Middle East
&
-59
As ia
-100
Developed Asia
Af ri c a
-75
-66
er ic a
-72
North America
ev el op ed
Emerging Europe
D
-59
Am
-50
Emerging Asia
No r th
-61
Eu ro pe
-62
Western Europe
Au st ra la sia
Australasia
As ia
0 -25
er gi ng
Balance*
25
Em
or fall in occupier demand over the last 3 months
er gi ng
Region
Em
Proportion of surveyors reporting a rise, no change
Eu ro pe
World
balance will be 25%) All data is not seasonally adjusted
Available space How has available space for occupation changed over the last three months compared to the previous three months for the leasing market
Change in available space
Balance of respondents,% 2008 2nd Qtr
100
2008 3rd Qtr.
available space rising
2008 4th Qtr.
2009 1st Qtr.
75 50
0
Australasia
73
-25
Western Europe
57
-50
Emerging Asia
56
Emerging Europe
42
North America
77
Am
&
M
id dl e
ev el op ed
La ti n
Ea st
As ia
ic a er Am or th
available space falling
Af ri c a
reporting a fall (if 30% reported a rise and 5% reported a fall, the unadjusted
D
W
* Balance = Proportion of surveyors reporting a rise in prices minus those
N
21
Eu ro pe
Latin America
As ia
45
es te rn
73
Africa & Middle East
Au st ra la sia
Developed Asia
-75 -100
er gi ng
Balance*
25
Em
or fall in occupier demand over the last 3 months
er gi ng
Region
Em
Proportion of surveyors reporting a rise, no change
Eu ro pe
World
balance will be 25%) All data is not seasonally adjusted
Change in rents How have rents changed in the last 3 months compared to the previous 3 months?
Change in rents
Balance of respondents,% 2008 2nd Qtr
100
2008 3rd Qtr.
rents rising
2008 4th Qtr.
2009 1st Qtr.
75 50
W
reporting a fall (if 30% reported a rise and 5% reported a fall, the unadjusted balance will be 25%) All data is not seasonally adjusted
6
Am La ti n
Ea st &
M
id dl e
As ia
-18
* Balance = Proportion of surveyors reporting a rise in prices minus those
Af ri c a
-32
Latin America
ev el op ed
Africa & Middle East
rents falling
D
-87
a
Developed Asia
-75 -100 er ic
-76
Am
-74
North America
or th
Emerging Europe
-50
N
-69
Eu ro pe
Emerging Asia
-25
As ia
-52
er gi ng
Western Europe
0
Em
-75
er gi ng
Australasia
25
Em
Balance*
Eu ro pe
or fall in occupier demand over the last 3 months
rn
Region
es te
Proportion of surveyors reporting a rise, no change
Au st ra la sia
World
Lettings market activity Occupier enquiries Change in occupier enquiries
Balance of respondents,% 2008 2nd Qtr
100
2008 3rd Qtr.
2008 4th Qtr.
Proportion of surveyors reporting a rise, no change
Region
or fall in occupier demand over the last 3 months
50
Balance*
25
Australasia
-76
0
Western Europe
-43
-25
Emerging Asia
-55
Emerging Europe
-76
North America
-56
-75
Developed Asia
-48
-100
Africa & Middle East
-35
Latin America
-33
Western Europe
65
Emerging Asia
47
Emerging Europe
69
-75
North America
75
-100
Developed Asia
74
N
Am La ti n
id dl e M
Am La ti n
Ea st id dl e M &
a
or th
ev el op ed
As ia
er ic a Am
Eu ro pe in g
inducements falling
Af ri c
reporting a fall (if 30% reported a rise and 5% reported a fall, the unadjusted
D
W
* Balance = Proportion of surveyors reporting a rise in prices minus those
er g
21
ia
44
Latin America
-50
Au st ra la s
Africa & Middle East
&
0 -25
As ia
85
Em
Australasia
2009 1st Qtr.
25
er gi ng
Balance*
Em
or fall in occupier demand over the last 3 months
2008 4th Qtr.
50
Eu ro pe
Region
2008 3rd Qtr.
inducements rising
75
rn
Proportion of surveyors reporting a rise, no change
2008 2nd Qtr
100
es te
World
Change in inducements
Balance of respondents,%
enquiries falling
Af ri c a
D
balance will be 25%) All data is not seasonally adjusted
How has typical value of any incentive packages to new tenants changed in your area compared to the previous three month period?
Ea st
As ia
er ic a
N
or th
ev el op ed
Am
Eu ro pe
As ia
er gi ng
er gi ng
Em
es te rn
W
reporting a fall (if 30% reported a rise and 5% reported a fall, the unadjusted
Em
Au st ra la sia
-50
* Balance = Proportion of surveyors reporting a rise in prices minus those
Inducements
2009 1st Qtr.
75
World
Eu ro pe
How has the level of occupier enquiries changed in the last 3 months?
enquiries rising
balance will be 25%) All data is not seasonally adjusted
Proportion of surveyors reporting a rise, no change
Region
or fall in occupier demand over the last 3 months
50
Balance*
25
Australasia
-81
0
Western Europe
-63
-25
7
2009 1st Qtr.
Am La ti n
Ea st idd le M &
er ic a
As ia Af ri c a
balance will be 25%) All data is not seasonally adjusted
De ve lo pe d
W
reporting a fall (if 30% reported a rise and 5% reported a fall, the unadjusted
Am
-12
No r th
Latin America
Eu ro pe
-31
er gi ng
-100
Africa & Middle East
Em
-75
-75
As ia
-81
Developed Asia
Au st ra la sia
North America
* Balance = Proportion of surveyors reporting a rise in prices minus those
2008 4th Qtr.
-50
er gi ng
-69
Em
-57
Emerging Europe
2008 3rd Qtr.
rents expected to rise
75
World
Emerging Asia
2008 2nd Qtr
100
Eu ro pe
How do you expect rents to change in the coming three months compared to the previous 3 month period?
Change in rental expectations
Balance of respondents,%
es te rn
Rental expectations
rents expected to fall
Development market activity Development pipeline
or fall in occupier demand over the last 3 months
50 25
Australasia
-90
0
Western Europe
-56
-25
id dl e
Am
pipeline development falling
Af ri c a
&
M
La ti n
Ea st
As ia
er ic a
ev el op ed
Am
D
reporting a fall (if 30% reported a rise and 5% reported a fall, the unadjusted
or th
-28
* Balance = Proportion of surveyors reporting a rise in prices minus those
N
Latin America
Eu ro pe
-19
As ia
-29
Africa & Middle East
er gi ng
Developed Asia
-75 -100
Em
-80
es te rn
North America
2009 1st Qtr.
-50
W
-75
Au st ra la sia
-39
Emerging Europe
2008 4th Qtr
pipeline development rising
75
Balance*
Emerging Asia
2008 3rd Qtr
er gi ng
Proportion of surveyors reporting a rise, no change
Em
World Region
Change in pipeline development
Balance of respondents,% 2008 2nd Qtr. 100
Eu ro pe
How do you view the development pipeline compared to 3 months ago?
balance will be 25%) All data is not seasonally adjusted
Marketed properties How has the number of properties marketed by your company changed over the last 3 months compared to the previous 3 month period?
Change in number of marketed properties
Balance of respondents,%
2008 2nd Qtr
100
2008 3rd Qtr.
2008 4th Qtr.
rising
2009 1st Qtr.
75
World
Proportion of surveyors reporting a rise, no change
50
Region
or fall in occupier demand over the last 3 months
25
Balance*
0
Am La ti n
id dl e M &
ev el op ed
As
Ea st
ia
er ic a
falling
Af ri c a
reporting a fall (if 30% reported a rise and 5% reported a fall, the unadjusted
D
W
* Balance = Proportion of surveyors reporting a rise in prices minus those
Am
5
or th
4
Latin America
N
26
Africa & Middle East
Eu ro pe
Developed Asia
-75 -100 As ia
-6
er gi ng
North America
-50
Em
10
er gi ng
5
Emerging Europe
Em
18
Emerging Asia
Eu ro pe
Western Europe
-25
es te rn
1
Au st ra la sia
Australasia
balance will be 25%) All data is not seasonally adjusted
Development completions How have development completions changed in the last 3 months compared to the previous 3 months?
Change in development completions Balance of respondents,% 2008 2nd Qtr. 2008 3rd Qtr 2008 4th Qtr 100
2009 1st Qtr.
development completions rising
75
World
Proportion of surveyors reporting a rise, no change
50
Region
or fall in occupier demand over the last 3 months
25
Balance*
0
balance will be 25%) All data is not seasonally adjusted
8
Am La ti n
Ea st &
M
id dl e
As ia
ev el op ed D
Af ri c a
reporting a fall (if 30% reported a rise and 5% reported a fall, the unadjusted
er ic a
6
* Balance = Proportion of surveyors reporting a rise in prices minus those
Am
Latin America
or th
0
N
-11
Africa & Middle East
Eu ro pe
Developed Asia
-75 -100 As ia
-30
er gi ng
North America
-50
Em
-62
er gi ng
Emerging Europe
Em
-13
Eu ro pe
-36
Emerging Asia
es te rn
Western Europe
-25
W
-9
Au st ra la sia
Australasia
development completions falling
Investment market activity Capital values 2008 2nd Qtr
100
World
Proportion of surveyors reporting a rise, no change
75
Region
or fall in occupier demand over the last 3 months
50
-57
Emerging Europe
-83
North America
-91
-75
Developed Asia
-95
-100
Africa & Middle East
-43
Latin America
-57
80
Western Europe
55
Emerging Asia
11
-50
Emerging Europe
58
-75
North America
80
Developed Asia
90
balance will be 25%) All data is not seasonally adjusted
W
reporting a fall (if 30% reported a rise and 5% reported a fall, the unadjusted balance will be 25%) All data is not seasonally adjusted
9
Am La tin
Ea st &
Am La ti n
Ea st idd le M &
Am La ti n
Ea st id dl e M
-36
* Balance = Proportion of surveyors reporting a rise in prices minus those
&
Latin America
As ia
-28
Af ri c a
-67
Africa & Middle East
ev el op ed
Developed Asia
-75 -100
D
-63
er ic a
-65
North America
Am
Emerging Europe
-50
or th
-63
N
-49
Emerging Asia
Eu ro pe
Western Europe
0 -25
er gi ng
-31
As ia
Australasia
2009 1st Qtr.
25
Em
Balance*
2008 4th Qtr.
50
er gi ng
or fall in occupier demand over the last 3 months
Em
Proportion of surveyors reporting a rise, no change
2008 3rd Qtr.
investment bidders to rise
75
Eu ro pe
World Region
2008 2nd Qtr
100
es te rn
Please indicate if the number of investment bidders per property has changed over the last 3 months compared to the previous 3 month period
Change in investment bidders per property
Balance of respondents,%
Au st ra la sia
Investment bidders per property
yields expected to fall
Af ri c a
D
ev el op ed
As ia
er ic a
N
or th
Am
Eu ro pe er gi ng
es te rn
reporting a fall (if 30% reported a rise and 5% reported a fall, the unadjusted
As ia
-100
W
11
* Balance = Proportion of surveyors reporting a rise in prices minus those
-25
Au st ra la sia
Latin America
1
Af ric a
0
Australasia
Africa & Middle East
2009 1st Qtr.
25
Em
Balance*
2008 4th Qtr.
50
er gi ng
or fall in occupier demand over the last 3 months
2008 3rd Qtr.
yields expected to rise
75
Em
Proportion of surveyors reporting a rise, no change
2008 2nd Qtr
100
Eu ro pe
World Region
Change in investment yields
Balance of respondents,%
values expected to fall
M
ev el op ed
or th N
balance will be 25%) All data is not seasonally adjusted
How have investment yields on commercial real estate changed over the past 3 months compared to the previous 3 months?
id dl e
As ia
er ic a Am
Eu ro pe
As ia
D
W
Au st ra la sia
-50
reporting a fall (if 30% reported a rise and 5% reported a fall, the unadjusted
Investment yields
2009 1st Qtr.
0
Emerging Asia
* Balance = Proportion of surveyors reporting a rise in prices minus those
2008 4th Qtr.
-25
er gi ng
-67
Em
Western Europe
2008 3rd Qtr.
25
Em
-88
Eu ro pe
Australasia
es te rn
Balance*
values expected to rise
Change in capital values
Balance of respondents,%
er gi ng
Please indicate how capital values have changed over the last 3 months compared to the previous 3 month period
investment bidders to fall
Investment market activity Investor purchases offices How have investor purchases of real estate changed over the last 3 months compared to the previous 3 months, in terms of the number of sales? World
Proportion of surveyors reporting a rise, no change
Region
or fall in occupier demand over the last 3 months Balance*
Change in investor purchases for offices
Balance of respondents,% 2008 2nd Qtr
100
2008 3rd Qtr
2008 4th Qtr
investor purchases rising
2009 1st Qtr
75 50 25 0
-18
Am La ti n
Ea st &
M
id dl e
ev el op ed
As ia
er ic a Am
investor purchases falling
Af ri c a
reporting a fall (if 30% reported a rise and 5% reported a fall, the unadjusted
D
* Balance = Proportion of surveyors reporting a rise in prices minus those
or th
-10
N
-49
Latin America
Eu ro pe
-49
Africa & Middle East
As ia
Developed Asia
-75 -100
er gi ng
-63
Em
North America
-50
er gi ng
-60
Em
Emerging Europe
Eu ro pe
-70
es te rn
-65
Emerging Asia
W
Western Europe
-25
Au st ra la sia
Australasia
balance will be 25%) All data is not seasonally adjusted
World
Proportion of surveyors reporting a rise, no change
50
or fall in occupier demand over the last 3 months
25
Balance*
2008 4th Qtr.
0
Western Europe
-63
Emerging Asia
-48
-50
Emerging Europe
-68
-75
North America
-65
Developed Asia
-58
Africa & Middle East
-59
Latin America
-20
World
Proportion of surveyors reporting a rise, no change
Region
or fall in occupier demand over the last 3 months Balance*
Balance of respondents,%
Am La ti n
Ea st idd le
Change in invetment purchases for industrial
2008 2nd Qtr
100
M
Af ri c a
D
balance will be 25%) All data is not seasonally adjusted
Investor purchases industrial
2008 3rd Qtr
investor purchases falling
&
N
or th
ev el op ed
As ia
er ic a Am
Eu ro pe
As ia
er gi ng
es te rn
W
reporting a fall (if 30% reported a rise and 5% reported a fall, the unadjusted
Em
Au st ra la sia
-100
* Balance = Proportion of surveyors reporting a rise in prices minus those
How have investor purchases of real estate changed over the last 3 months compared to the previous 3 months, in terms of the number of sales?
2009 1st Qtr
-25
er gi ng
-35
2008 3rd Qtr
investor purchases rising
75
Region
Australasia
2008 2nd Qtr
100
Em
How have investor purchases of real estate changed over the last 3 months compared to the previous 3 months, in terms of the number of sales?
Change in investor purchases for retail
Balance of respondents,%
Eu ro pe
Investor purchases retail
2008 4th Qtr
investment purchases rising
2008 1st Qtr
75 50 25 0
-40 -65
-25
Emerging Asia
-43
-50
Emerging Europe
-63
North America
-62
10
Am La ti n
Ea st M
id dl e
As ia &
er ic a N
or th
Am
Eu ro pe
As ia
er gi ng
ev el op ed
Af ri c a
balance will be 25%) All data is not seasonally adjusted
D
reporting a fall (if 30% reported a rise and 5% reported a fall, the unadjusted
Em
* Balance = Proportion of surveyors reporting a rise in prices minus those
er gi ng
-30
Em
-54
Latin America
Eu ro pe
-54
Africa & Middle East
es te rn
Developed Asia
-75 -100 Au st ra la sia
Western Europe
W
Australasia
investment purchases falling
RICS Global Commercial Property Survey Regional statistics - Developed Asia / Australasia Tenant Demand
-100
-80
-60
-40
Change in Rents
-20
0
20
40
60
80
-100
100
Hong Kong
Hong Kong
Japan
Japan
Singapore
Singapore
South Korea
South Korea
DEVELOPED ASIA
DEVELOPED ASIA
DA ex Japan
DA ex Japan
DA ex Jap/Korea
DA ex Jap/Korea
Australia
Australia
-60
-40
-20
0
20
40
60
80
100
New Zealand
New Zealand
AUSTRALASIA
AUSTRALASIA
DA + Australasia
DA + Australasia
Investment Bidders -100
-80
-80
-60
-40
Yields -20
0
20
40
60
80
100
-100
Hong Kong
Hong Kong
Japan
Japan
Singapore
Singapore
South Korea
South Korea
DEVELOPED ASIA
DEVELOPED ASIA
DA ex Japan
DA ex Japan
DA ex Jap/Korea
DA ex Jap/Korea
Australia
Australia
New Zealand
New Zealand
AUSTRALASIA
AUSTRALASIA
DA + Australasia
DA + Australasia
11
-80
-60
-40
-20
0
20
40
60
80
100
RICS Global Commercial Property Survey Regional statistics - Developed Asia / Australasia Pipeline Development
-100
-80
-60
-40
-20
Available space
0
20
40
60
80
100
-100
Hong Kong
Hong Kong
Japan
Japan
Singapore
Singapore
South Korea
South Korea
DEVELOPED ASIA
DEVELOPED ASIA
DA ex Japan
DA ex Japan
DA ex Jap/Korea
DA ex Jap/Korea
Australia
Australia
New Zealand
New Zealand
AUSTRALASIA
AUSTRALASIA
DA + Australasia
DA + Australasia
Inducements
-100
-80
-80
-60
-40
-20
0
20
40
60
80
100
Rental Expectations
-60
-40
-20
0
20
40
60
80
100
-100
Hong Kong
Hong Kong
Japan
Japan
Singapore
Singapore
South Korea
South Korea
DEVELOPED ASIA
DEVELOPED ASIA
DA ex Japan
DA ex Japan
DA ex Jap/Korea
DA ex Jap/Korea
Australia
Australia
New Zealand
New Zealand
AUSTRALASIA
AUSTRALASIA
DA + Australasia
DA + Australasia
12
-80
-60
-40
-20
0
20
40
60
80
100
RICS Global Commercial Property Survey Regional statistics - Americas Tenant Demand -100
-80
-60
Change in Rents -40
-20
0
20
40
60
80
100
-100
Canada
-60
-40
-20
0
20
40
60
80
100
-80
-60
-40
-20
0
20
40
60
80
100
Canada
US
US
NORTH AMERICA
NORTH AMERICA
Argentina
Argentina
Brazil
Brazil
Colombia
Colombia
Rest of Latin America
Rest of Latin America
LATIN AMERICA
LATIN AMERICA
Investment Bidders
-100
-80
-80
-60
-40
Yields
-20
0
20
40
60
80
100
-100
Canada
Canada
US
US NORTH AMERICA
NORTH AMERICA
Argentina
Argentina Brazil
Brazil Colombia
Colombia Mexico
Rest of Latin America
Rest of Latin America
LATIN AMERICA
LATIN AMERICA
13
RICS Global Commercial Property Survey Regional statistics - Americas Pipeline Development
-100
-80
-60
-40
Available space
-20
0
20
40
60
80
-100
100
Canada
Canada
US
US
NORTH AMERICA
NORTH AMERICA
Argentina
Argentina
Brazil
Brazil
Colombia
Colombia
Rest of Latin America
Rest of Latin America
LATIN AMERICA
LATIN AMERICA
Inducements -100
-80
-80
-60
-40
-20
0
20
40
60
80
100
Rental Expectations -60
-40
-20
0
20
40
60
80
100
-100
Canada
Canada
US
US
NORTH AMERICA
NORTH AMERICA
Argentina
Argentina
Brazil
Brazil
Colombia
Colombia
Rest of Latin America
Rest of Latin America
LATIN AMERICA
LATIN AMERICA
14
-80
-60
-40
-20
0
20
40
60
80
100
RICS Global Commercial Property Survey Regional statistics - Emerging Asia Tenant Demand -100
-80
-60
Change in Rents -40
-20
0
20
40
60
80
-100
100
China
China
India
India
Malaysia
Malaysia
Philippines
Philippines
Thailand
Thailand
Vietnam
Vietnam
EMERGING ASIA
EMERGING ASIA
EMERGING ASIA ex INDIA/CHINA
EMERGING ASIA ex INDIA/CHINA
Investment Bidders
-100
-80
-60
-40
-80
-60
-40
-20
0
20
40
60
80
100
-80
-60
-40
-20
0
20
40
60
80
100
Yields
-20
0
20
40
60
80
100
-100
China
China
India
India
Malaysia
Malaysia
Philippines
Philippines
Thailand
Thailand
Vietnam
Vietnam
EMERGING ASIA
EMERGING ASIA
EMERGING ASIA ex INDIA/CHINA
EMERGING ASIA ex INDIA/CHINA
15
RICS Global Commercial Property Survey Regional statistics - Emerging Asia Pipeline Development
-100
-80
-60
-40
Available Space
-20
0
20
40
60
80
-100
100
China
China
India
India
Malaysia
Malaysia
Philippines
Philippines
Thailand
Thailand
Vietnam
Vietnam
EMERGING ASIA
EMERGING ASIA
EMERGING ASIA ex INDIA/CHINA
EMERGING ASIA ex INDIA/CHINA
Inducements
-100
-80
-80
-60
-40
-20
0
20
-20
0
20
40
60
80
100
Rental Expectations
-60
-40
-20
0
20
40
60
80
100
-100
China
China
India
India
Malaysia
Malaysia
Philippines
Philippines
Thailand
Thailand
Vietnam
Vietnam EMERGING ASIA
EMERGING ASIA EMERGING ASIA ex INDIA/CHINA
EMERGING ASIA ex INDIA/CHINA
16
-80
-60
-40
40
60
80
100
RICS Global Commercial Property Survey Regional statistics - Western Europe Tenant Demand
-100
-80
-60
-40
Change in Rents
-20
0
20
40
60
80
-100
100
Belgium
Belgium
France
France
Germany
Germany
Italy
Italy
Luxembourg
Luxembourg
Portugal
Portugal
Republic of Ireland
Republic of Ireland
Sandinavia
Sandinavia
Spain
Spain
Switzerland
Switzerland
The Netherlands
The Netherlands
UK
UK
WESTERN EUROPE
WESTERN EUROPE
Investment Bidders
-100
-80
-60
-40
-80
-60
-40
-20
0
20
40
60
80
-40
-20
0
20
40
60
80
100
Yields
-20
0
20
40
60
80
100
-100
Belgium
Belgium
France
France
Germany
Germany
Italy
Italy
Luxembourg
Luxembourg
Portugal
Portugal
Republic of Ireland
Republic of Ireland
Sandinavia
Sandinavia
Spain
Spain
Switzerland
Switzerland
The Netherlands
The Netherlands
UK
UK
WESTERN EUROPE
WESTERN EUROPE
17
-80
-60
100
RICS Global Commercial Property Survey Regional statistics - Western Europe Pipeline Development
-100
-80
-60
-40
-20
Available Space
0
20
40
60
80
100
-100
Belgium
Belgium
France
France
Germany
Germany
Italy
Italy
Luxembourg
Luxembourg
Portugal
Portugal
Republic of Ireland
Republic of Ireland
Sandinavia
Sandinavia
Spain
Spain
Switzerland
Switzerland
The Netherlands
The Netherlands
UK
UK
WESTERN EUROPE
WESTERN EUROPE
Inducements -100
-80
-80
-60
-40
-20
0
-20
0
20
40
60
80
100
Rental Expectations -60
-40
-20
0
20
40
60
80
-100
100
Belgium
Belgium
France
France
Germany
Germany
Italy
Italy
Luxembourg
Luxembourg
Portugal
Portugal
Republic of Ireland
Republic of Ireland
Sandinavia
Sandinavia
Spain
Spain
Switzerland
Switzerland
The Netherlands
The Netherlands
UK
UK
WESTERN EUROPE
WESTERN EUROPE
18
-80
-60
-40
20
40
60
80
100
RICS Global Commercial Property Survey Regional statistics - Emerging Europe Tenant Demand
-100
-80
Change in Rents
-60
-40
-20
0
20
40
60
80
100
-100
Bulgaria
Bulgaria
Croatia
Croatia
Czech Republic
Czech Republic
Hungary
Hungary
Poland
Poland
Romania
Romania
Russia
Russia
Turkey
Turkey
Ukraine
Ukraine
-60
-40
-20
0
20
40
60
-80
-60
-40
-20
0
20
40
60
80
100
EMERGING EUROPE
EMERGING EUROPE
Budapest, Prague and Warsaw
Budapest, Prague and Warsaw
Rest of Emerging Europe
Rest of Emerging Europe
Investment Bidders
-100
-80
-80
-60
Yields
-40
-20
0
20
40
60
80
-100
100
Bulgaria
Bulgaria
Croatia
Croatia
Czech Republic
Czech Republic
Hungary
Hungary
Poland
Poland
Romania
Romania
Russia
Russia
Turkey
Turkey
Ukraine
Ukraine
EMERGING EUROPE
EMERGING EUROPE
Budapest, Prague and Warsaw
Budapest, Prague and Warsaw
Rest of Emerging Europe
Rest of Emerging Europe
19
80
100
RICS Global Commercial Property Survey Regional statistics - Emerging Europe Pipeline Development
-100
-80
-60
-40
Available Space
-20
0
20
40
60
80
100
-100
Bulgaria
Bulgaria
Croatia
Croatia
Czech Republic
Czech Republic
Hungary
Hungary
Poland
Poland
Romania
Romania
Russia
Russia
Turkey
Turkey
Ukraine
Ukraine
EMERGING EUROPE
EMERGING EUROPE
Budapest, Prague and Warsaw
Budapest, Prague and Warsaw
Rest of Emerging Europe
Rest of Emerging Europe
Inducements
-100
-80
-60
-40
-20
0
20
40
60
80
-40
-20
0
20
40
60
80
100
Rental Expectations
-80
-60
-40
-20
0
20
40
60
80
100
-100
Bulgaria
Bulgaria
Croatia
Croatia
Czech Republic
Czech Republic
Hungary
Hungary
Poland
Poland
Romania
Romania
Russia
Russia
Turkey
Turkey
Ukraine
Ukraine
EMERGING EUROPE
EMERGING EUROPE
Budapest, Prague and Warsaw
Budapest, Prague and Warsaw
Rest of Emerging Europe
Rest of Emerging Europe
20
-80
-60
100
RICS Global Commercial Property Survey Regional statistics - Africa and Middle East Tenant Demand -100
-80
-60
Change in Rents -40
-20
0
20
40
60
80
100
-100
Saudi Arabia
Saudi Arabia
South Africa
South Africa
UAE
UAE
Africa Ex SA
Africa Ex SA
Middle East
Middle East
Africa
Africa
Africa & Middle East
Africa & Middle East
Investment Bidders -100
-80
-60
-40
-80
-60
-40
-20
0
20
40
60
80
100
-80
-60
-40
-20
0
20
40
60
80
100
Yields -20
0
20
40
60
80
100
-100
Saudi Arabia
Saudi Arabia
South Africa
South Africa
UAE
UAE
Africa Ex SA
Africa Ex SA
Middle East
Middle East
Africa
Africa
Africa & Middle East
Africa & Middle East
21
RICS Global Commercial Property Survey Regional statistics - Africa and Middle East Pipeline Development -100
-80
-60
-40
-20
Available Space 0
20
40
60
80
100
-100
Saudi Arabia
Saudi Arabia
South Africa
South Africa
UAE
UAE
Africa Ex SA
Africa Ex SA
Middle East
Middle East
Africa
Africa
Africa & Middle East
Africa & Middle East
Inducements -100
-80
-80
-60
-40
-20
0
20
40
60
80
100
-20
0
20
40
60
80
100
Rental Expectations -60
-40
-20
0
20
40
60
80
-100
100
Saudi Arabia
Saudi Arabia
South Africa
South Africa
UAE
UAE
Africa Ex SA
Africa Ex SA
Middle East
Middle East
Africa
Africa
Africa & Middle East
Africa & Middle East
22
-80
-60
-40
RICS Global Commercial Property Survey Survey Methodology RICS Global Commercial Property Survey RICS’ Global Commercial Property Survey is a quarterly guide to the developing trends in the commercial property investment and occupier market. This edition details market conditions for the first quarter of 2009 based on information collected from leading international real estate organisations and local firms. This survey of the UK Commercial Market was conducted in conjunction with YouGov, a leading online research company. 361 surveyor offices responded to the questionnaire conducted between 19/03/2009 and 07/ 05/2009. This survey was run in accordance with MRS guidelines. YouGov have been appointed to conduct the majority of RICS surveys from December 2008. Methodology Survey questionnaires were sent to real estate organisations in March 2009, with responses received up until the 7th of May 2009. Respondents were asked to compare conditions over the latest Three months with the previous three months. A total of 361 responses were received. Responses have been amalgamated across the three real estate sub-sectors of offices, retail and industrial property at a city level, to form diffusion indices for the commercial market as a whole. The eight world regional groupings have been derived through the weighting of city level diffusion data using city population and country gross domestic product statistics. Contact details For further information please contact RICS Communications Directorate T +44 (0)20 7334 3774/3891 Taking part in the RICS Global Property Survey If you wish to participate in the quarterly survey, please email jguilfoyle@rics.org to register your details. Please provide your name, company details and the location(s) you wish to cover within the email or register online at www.rics.org/globalproperty Become a member of RICS If you would like to find out more about becoming a member of RICS, please visit www.rics.org/professional
RICS Global Commercial Property Survey Disclaimer This document is intended as a means for debate and discussion and should not be relied on as legal or professional advice. Whilst every reasonable effort has been made to ensure the accuracy of the contents, no warranty is made with regard to that content. Data, information or any other material may not be accurate and there may be other more recent material elsewhere. RICS will have no responsibility for any errors or omissions. RICS recommends you seek professional, legal or technical advice where necessary. RICS cannot accept any liability for any loss or damage suffered by any person as a result of the editorial content, or by any person acting or refraining to act as a result of the material included.
23
RICS Global Commercial Property Survey Subscription information and contributor enquiries The Quarterly Global Commercial Property Survey is available from the RICS web site - www.rics.org, along with other quarterly surveys covering the housing market, residential lettings, commercial property, construction activity, the farmland market and arts and antiques.
This publication has been produced by RICS Economics. For economic and statistical enquiries regarding this publication, please contact. Oliver Gilmartin RICS Senior Economist Communications Directorate Tel +44 (0)20 7334 3847. For access to city level agents’ comments and contributor details please go to the following web address. www.rics.org/GPScomments2009q1
The Royal Institution of Chartered Surveyors 12 Great George Street Parliament Square London SW1P 3AD T +44 (0)20 7222 7000 F +44 (0)20 7334 3846
24
RICS represents 140,000 members worldwide. These professionals provide expert advice on land, property, construction and the associated environmental issues. An independent, not-for-profit organisation, RICS acts in the public interest, upholding standards of competence and integrity among its members and providing impartial, authoritative advice on issues affecting business and society.