research
autumn 2012
european Market Indicators
European rental cycles Offices Moscow, Paris Geneva Frankfurt, Helsinki, London (City), London (West End), Oslo, Stockholm, Warsaw Bucharest, Prague, Vienna
Munich Kiev
Zurich
Barcelona, Lisbon, Madrid, Milan Brussels, Budapest, Dublin, Edinburgh
Amsterdam, Copenhagen
Logistics
Moscow Zurich
Helsinki, Munich, Oslo, Prague
Geneva, Stockholm Warsaw Frankfurt, Kiev
Barcelona, Bucharest, Dublin, Lisbon, Madrid Amsterdam, Brussels, Budapest, Copenhagen, Edinburgh, Milan, Vienna
London, Paris
Shopping centres Geneva, Moscow, Warsaw Frankfurt, Kiev
Barcelona, Madrid, Paris, Zurich
Helsinki, Munich, Oslo, Prague
Dublin, Lisbon
Vienna
Stockholm
Amsterdam, Brussels, Bucharest, Budapest, Copenhagen, Edinburgh
London, Milan
The Knight Frank wave depicts the current position of selected European centres with respect to their local prime rental cycle. As demand swells relative to supply and rents rise, centres move towards the crest of the wave. As demand ebbs and rental levels weaken, centres start to move down the wave towards the trough. Some markets will ride the wave more quickly than others. Similarly, some markets will tread water for periods of time or move only gently through the wave.
autumn 2012
european Market Indicators
Market monitor – Autumn 2012
Offices Logistics Shopping centres Retail warehousing City Prime rents Prime yields Prime rents Prime yields Prime rents Prime yields Prime rents Prime yields (€/sq m/yr) (%) (€/sq m/yr) (%) (€/sq m/yr) (%) (€/sq m/yr) (%) 6.25 5 85 4 7.25 4 1,000 4 5.50 4 135 4 6.75 4 Amsterdam 340 4 Barcelona 192 6 6.00 5 72 6 8.25 5 504 6 6.75 5 162 6 7.00 5 Brussels 275 4 6.25 5 45 4 7.25 4 1,250 4 5.50 4 170 4 6.25 4 Bucharest 216 4 8.50 4 48 4 10.50 4 810 4 9.00 4 96 4 10.00 4 Budapest 240 4 7.25 4 54 4 9.00 4 960 4 7.00 4 102 4 7.75 4 Copenhagen 241 4 5.00 4 67 4 7.25 4 644 4 5.75 4 150 4 6.75 4 Dublin 323 4 7.00 4 65 4 9.50 4 3,000* 4 8.00 4 75 6 8.25 4 Edinburgh 360 4 6.50 4 94 4 7.75 4 2,298* 4 6.25 5 401 4 6.25 5 Frankfurt 432 4 5.00 4 75 4 6.75 4 1,500 4 4.75 4 120 4 6.50 4 Geneva 820 5 4.75 4 150 4 6.00 4 1,100 4 5.00 5 250 4 5.50 4 Helsinki 366 4 5.50 4 108 4 7.25 4 1,250 4 5.25 4 145 4 6.75 4 Kiev 335 4 12.50 4 57 4 11.00 4 861 5 12.00 6 N/A N/A Lisbon 216 6 7.75 5 60 4 8.75 5 780 4 7.75 5 102 6 8.25 5 London 1,239 (WE) 4 / 716 (C) 4 4.00(WE) 4/ 5.25(C) 4 160 4 6.25 4 5,947* 4 5.25 4 535 4 5.25 5 Madrid 312 6 6.00 5 72 6 8.25 5 528 6 6.75 5 162 6 7.00 5 Milan 520 6 5.50 5 55 4 8.00 5 750 4 6.25 5 150 4 7.25 5 Moscow 924 4 8.50 4 104 4 11.00 4 2,015 4 9.50 4 N/A N/A Munich 366 4 4.50 4 75 4 6.75 4 1,800 4 4.75 4 144 4 6.25 6 Oslo 489 4 5.25 4 136 4 6.50 4 1,000 4 5.50 4 135 4 6.25 4 Paris 830 4 4.50 4 53 4 7.25 4 1,800 6 4.75 4 180 4 5.50 6 Prague 246 4 6.25 4 51 4 8.00 5 840 4 6.25 4 120 4 7.50 4 Stockholm 533 4 4.75 4 124 4 6.75 4 800 4 5.00 4 200 4 5.75 4 Vienna 294 4 5.25 4 72 4 7.25 4 1,080 4 5.75 4 156 4 6.50 4 Warsaw 301 4 6.25 4 66 4 7.75 4 1,020 4 6.25 4 96 4 7.25 4 Zurich 650 4 4.50 4 140 4 6.00 4 1,200 4 5.00 5 250 5 5.50 4 Indicative prime yields, as quoted locally, based upon a hypothetical Grade A unit. Office rents are for prime city area Grade A space, 2,000 sq m. Shopping Centre rents are based on prime covered shopping malls, quoted on best position, 100 sq m units. Retail Warehouse rents are for units of 1-5,000 sq m located in purpose built parks. Typical Retail Warehouse schemes vary between countries. Logistics rents are for prime industrial space of units over 5,000 sq m. The data above is provided for general reference purposes only. Local market conditions will vary. *Zoned/weighted figure. Arrows provide a broad indication of recent movements and the short-term outlook for prime rents and yields. London office data is quoted for the West End (WE) and City (C) submarkets.
European weighted average prime office yield
€ per sq m per annum
%
650
7.0
600
6.5
550
6.0
500
5.5
450
5.0
400
4.5
350
4.0
2007
2008
2009
2010
2011
2012
Source: Knight Frank
Spring Summer Autumn Winter Spring Summer Autumn Winter Spring Summer Autumn Winter Spring Summer Autumn Winter Spring Summer Autumn Winter Spring Summer Autumn
Figure 2
European weighted average prime office rent
Spring Summer Autumn Winter Spring Summer Autumn Winter Spring Summer Autumn Winter Spring Summer Autumn Winter Spring Summer Autumn Winter Spring Summer Autumn
Figure 1
2007 2008 Source: Knight Frank
2009
2010
2011
Figures 1 & 2 show averages of prime office rents and yields in the cities covered by this report, with markets weighted according to size and market maturity.
International Research
European Investment Team
European Valuations Team
Matthew Colbourne
Andrew Sim
Nick Powlesland
Senior Analyst
Partner, Head of European Investment
Partner, Head of European Valuations
+44 (0)20 7861 1238
+44 (0)20 7861 1193
+44 (0)20 7861 1283
matthew.colbourne@knightfrank.com
andrew.sim@knightfrank.com
nick.powlesland@knightfrank.com
www.KnightFrank.com Knight Frank LLP is a limited liability partnership registered in England with registered number OC305934. Our registered office is 55 Baker Street, London, W1U 8AN, where you may look at a list of members’ names.
2012