Total real estate investment in Europe reached €68.8 billion ($79.7 billion) in second quarter 2018, representing a small decrease of 8 percent from the same period last year, according to CBRE. This brings total investment in real estate during the first half of 2018 to €127.7 billion ($147.99 billion), compared to €132.2 billion ($153.2 billion) recorded in first half 2017.
Second quarter 2018 investment activity was driven by strong growth in the offices sector, with volumes totaling €29 billion ($34 billion), compared to €24.1 billion ($27.9 billion) in second quarter 2017. Office investment for first half 2018 was also up 11 percent from the same period last year. Furthermore, investment into alternative properties, including healthcare and student accommodation, remained resilient, with volumes on par with second quarter 2017 and 6 percent higher than first half 2017.
Following a year of political uncertainty and economic reform, investment volumes in France rebounded. Transaction levels for first half 2018 increased by 28 percent compared with first half 2017 with volumes for the last 12 months up 14 percent.
Following a more subdued start to the year, the United Kingdom posted a strong second quarter. Total investment in second quarter 2018 reached €19.9 billion ($23.1 billion), driven by a record quarter for London City office investment. Investment volumes in the United Kingdom for the past 12 months were up 15 percent on the same period previously as demand from Asian investors remains unabated. Similarly, Germany continued to perform well, posting investment volumes of €24.5 billion ($28.4 billion) for first half 2018, and Benelux and the Netherlands also posted strong performances, up 43 percent and 40 percent, respectively, on first half 2017.
“The Continental European markets have posted a strong first half to the year and have continued to perform well throughout second quarter 2018,” said Jonathan Hull, managing director of investment properties, EMEA at CBRE. “Germany has once again proved a major focus for capital and has demonstrated its status as a safe haven for global wealth, and we have witnessed the predicted recovery in France following a politically turbulent year. Similarly, the Netherlands and Belgium have performed exceptionally well, boosted by the sale of a large residential portfolio in the Netherlands. After a relatively slow start to the year, the United Kingdom has seen a significant recovery in investment volumes in second quarter 2018. Despite ongoing political uncertainties, the United Kingdom remains an attractive destination for European and global capital.”
