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- May 1, 2016: Vol. 10, Number 05

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Retail leads the way

by Ian Kelley

European commercial property has experienced something of a renaissance in the eyes of institutional investors, with investment volumes rocketing and even topping 2007 levels in some instances. According to Knight Frank’s latest European Quarterly Report, a total of €64.5 billion was invested in European commercial property in Q4 2015, taking volumes for the full year to €238.5 billion, a 25 percent increase on 2014.

Investors have been attracted by property’s potential to produce strong, stable income streams. Particularly at a time when the European Central Bank has introduced negative rates, real estate is much more appealing to many institutional investors versus keeping money in a bank account. However, a situation has developed where there is minimal rental growth across the majority of sectors, particularly office and logistics. However, there is one exception to this general rule: the retail sector.

The High Street retail segment, in particular, is thri

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