savills-commercial investment q1 2018


Market in Minutes - Germany commercial investment market Q4 2017

Transaction volume increases to €57.1bn despite lower amount of deals

  • Commercial property changed hands for almost €57.1bn in 2017, an increase of 4% compared with the previous year (Graph 1). However, the number of transactions declined by 8% (Graph 3), which was likely a reflection of the supply shortage.
  • Industrial and logistics property registered a significant increase (+78% compared with 2016). Institutional investors in particular, including Asian sovereign wealth funds and pension funds, are capitalising on the structural growth in this sector. In contrast, the transaction volumes for office property (-3% compared with 2016) and retail property (+2% compared with 2016) were largely unchanged.
  • In retrospect, 2017 was the year in which Asian investors made a grand entry into the German commercial property market. Overall, these were responsible for more than 9% of the acquisition volume (Graph 5), occupying second place behind American investors (10%).
  • The majority of purchasers continue to be long-term investors (Graph 6) seeking stable income.In view of the favourable economic projections, German real estate is likely to remain in high demand. The transaction volume in 2018 is expected to exceed the €50bn mark.