research
Summer 2011
european Market Indicators
European rental cycles Offices Brussels, Frankfurt, Geneva, Helsinki, Oslo, Vienna, Zurich
London (City), London (West End), Moscow Paris, Stockholm, Warsaw
Barcelona, Bucharest, Dublin, Lisbon, Madrid Budapest, Edinburgh
Amsterdam, Copenhagen, Kiev, Milan, Munich, Prague
Logistics Barcelona, Dublin, Madrid Moscow
Budapest, Lisbon
Warsaw
Amsterdam, Brussels, Bucharest, Copenhagen, Edinburgh, Kiev, Milan, Paris, Vienna
Frankfurt, Geneva, Helsinki, London, Munich, Oslo, Prague, Stockholm, Zurich
Shopping centres Moscow
Barcelona, Bucharest, Budapest, Dublin, Lisbon, Madrid
Warsaw
Amsterdam, Copenhagen, Edinburgh, Paris, Vienna
Brussels, Frankfurt, Geneva, Helsinki, Kiev, London, Milan, Munich, Oslo, Prague, Stockholm, Zurich
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.
summer 2011
european Market Indicators
Market monitor – Summer 2011
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) (%) 5.75 6 58 4 7.25 4 1,000 4 5.75 4 135 4 7.00 4 Amsterdam 340 4 Barcelona 222 6 6.00 4 78 4 7.75 4 528 4 6.50 4 168 4 6.75 4 Brussels 310 4 6.00 4 45 4 7.00 4 1,250 4 5.50 4 170 4 6.50 4 Bucharest 192 4 8.50 4 48 4 10.50 4 810 4 9.00 4 96 4 10.00 4 Budapest 240 4 7.50 4 54 4 9.00 4 900 4 7.00 4 102 4 8.00 4 Copenhagen 235 4 5.25 4 67 4 7.25 4 645 4 6.00 4 150 4 7.00 4 Dublin 376 4 7.25 5 75 6 9.00 5 3,750* 6 7.75 5 100 6 8.25 5 Edinburgh 333 4 6.00 4 88 4 6.75 4 2,160* 4 5.75 4 368 4 5.50 4 Frankfurt 432 5 5.00 6 72 5 7.00 6 1,800 4 5.25 4 108 4 6.75 6 Geneva 700 4 5.00 4 130 4 6.50 4 1,100 5 5.25 4 300 4 5.75 4 Helsinki 336 5 5.50 6 108 5 7.25 4 1,250 4 5.75 4 150 4 6.75 4 Kiev 283 4 12.00 4 50 4 12.00 4 768 4 13.00 4 N/A N/A Lisbon 228 6 7.00 5 60 4 8.00 4 900 4 7.25 4 96 4 7.75 4 London 1,111(WE) 5 / 679 (C) 4 4.00(WE) 4/ 5.25(C) 4 148 4 6.25 4 5,556* 4 5.25 6 494 4 5.25 4 Madrid 330 6 5.75 4 72 4 7.75 4 540 4 6.50 4 168 4 6.75 4 Milan 525 4 5.00 6 55 4 7.50 4 750 4 6.25 4 150 4 7.25 4 Moscow 768 5 9.50 4 89 5 12.00 4 1,990 5 10.50 4 N/A N/A Munich 360 5 4.50 4 78 4 7.00 4 1,800 4 5.25 4 144 4 6.50 6 Oslo 439 5 5.25 4 129 5 6.75 4 1,000 4 6.00 4 135 4 6.50 4 Paris 780 5 4.75 6 52 4 7.00 4 2,000 4 4.75 4 180 4 6.00 4 Prague 246 4 6.75 4 51 5 8.00 6 840 4 6.75 4 144 4 7.25 4 Stockholm 494 5 5.00 6 112 5 6.75 6 800 4 5.25 6 190 4 6.00 6 Vienna 294 4 5.25 4 72 4 7.25 4 1,080 4 6.00 4 156 4 6.50 4 Warsaw 288 4 6.50 6 66 4 7.75 6 1,020 4 6.50 6 96 4 7.50 6 Zurich 625 4 5.00 4 150 4 6.50 4 950 4 5.25 4 300 4 5.75 4
2006
2007
2008
2009
2010
2011
Source: Knight Frank
2006
2007
2008
2009
2010
Source: Knight Frank
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.
Summer
Winter Spring
Winter
Summer Autumn
Winter Spring
Autumn
Summer
Winter Spring
Autumn
Spring Summer
Autumn Winter
4.0
Spring
350
Summer
4.5
Summer
400
Winter Spring
5.0
Winter
450
Spring Summer Autumn
5.5
Summer Autumn
500
Winter Spring
6.0
Autumn
550
Summer
6.5
Winter Spring
600
Autumn
7.0
Spring Summer
%
650
Autumn Winter
European weighted average prime office yield
€ per sq m per annum
Spring
Figure 2
European weighted average prime office rent
Summer
Figure 1
Spring Summer Autumn
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.
2011