Benelux is a region of shapes, of unequal triangles and uncut diamonds. The triangle is the three variously-sized countries of Belgium, the Netherlands and Luxembourg; the diamond is the Randstad, the metropolitan area formed by the four main cities in the Netherlands
Going into the new century, many institutional investors still held to the traditional 60 percent equity and 40 percent fixed-income allocation, but they sensed that their big portfolios needed to diversify into uncorrelated assets, such as real estate.
Most investors with real estate in their portfolios will own two or three different types of investments. Those different types deliver different qualities to the portfolio.
In a world of low interest rates, asset prices are booming. Yields are at record low levels for both sovereign and corporate bonds. The cyclically-adjusted price-to-earnings ratio for the S&P 500 has only been higher in 1929 and at the peak of the dot.com bubble, while the FTSE 100 Index is trading at new record high levels in the range of 7,500.
Everyone knows that the key to success in real estate investment is transport, the ease of getting the people who work in an office or go shopping to that location. If that journey is difficult or becomes difficult, then the attraction of that location diminishes.
The latest edition of CBRE’s semi-annual Global Prime Office Rents survey, for H1 2017, shows that Hong Kong continues to be the world’s most expensive office market, with a prime rent of $269.26 per square foot per year ($2,898.29 per square metre per year/€2,469.41 per square metre per year).
Cushman & Wakefield says that its latest quarterly Fair Value Index™, which analyses 122 office, retail and logistics markets across Europe, shows that European real estate is “fairly priced” for the first time since 2009.
GEG German Estate Group AG recently commenced marketing of its Global Tower project in Frankfurt.
Firms continue to launch more funds in the market while many have held final closes.
Recent research undertaken by Sell House Fast has found a varied approach to self-storage across Europe. Much depends on the culture in individual countries and on the space in houses.
The number of students in European countries keeps rising and so do their demands for better student accommodation. Growth and rising demand against limited supply are always factors that will interest investors, and a number of countries have recently seen increased levels of investor and developer activity in domestic student accommodation markets.
History will judge whether property developers in Poland were right to build the high volume of new class A office space that has gone into the capital, Warsaw, and the various regional cities in recent years, and further capacity is under construction.
A decade ago, as many relaxed on their summer holidays over August, a financial crisis began to unfold that resonates loudly to this day. It ushered in an era of low global economic growth and, arguably, has been a contributing factor to the deepening of the economic divide in society and the rising nationalism and disillusionment that has so far resulted in Brexit and the election of Donald Trump.
Real estate is not a problem for Europe, not yet. So long as buyers, hungry for income-producing investments, are prepared to pay the prices now being asked for property of all kinds in all manner of places and so long as those sellers do not expect easily to be able to replace the asset in the portfolio with something equally good, then real estate markets across Europe will keep moving along quite nicely.