real estate leasing in europe - 2009

Eurofinas and Leaseurope Annual Convention - Prague, 05/10/2009

Session Leaseurope 2Session Leaseurope 2

The real estate leasing industry The real estate leasing industry –– State of playState of play

Overview of commercial real estate

in EuropeDaniela Percoco - Head of Real Estate

Prague, 05/10/2009Overview of commercial real estate in Europe 1

Agenda

Macroeconomic trends and forecasts in Europe

The investments in constructions

The real estate market

Investment flows

Cross border vs domestic

Nationality profile of investors and sellers

Deal size

Yields and rents trends

Focus on segments: office, retail and industrial


Macroeconomics trends and forecasts in Europe

Bank lending to households and to the non-financial corporate sector

Source: ECB



Source: IMF

Global GDP Growth



GDPQuarter on-quarter growth rates, EU

Source: ECB



GDP growth and Economic Sentiment Indicator, EU

Source: Commission services.

Prague, 05/10/2009Overview of commercial real estate in Europe


Annual GDP forecast (%, y-o-y)2009

May 2009 September 2009Germany -5.4 -5.1

Spain -3.2 -3.7

France -3.0 -2.1

Italy -4.4 -5.0

Netherlands -3.5 -4.5

Euro area -4.0 -4.0

Poland -1.4 1.0

United Kingdom -3.8 -4.3

EU27 -4.0 -4.0

Source: European Commission



Annual GDP forecast (%, y-o-y)2010

World 2.5

Advanced economies 0.6

Euro area 0.0*

Germany -0.6

France 0.4

Italy 0.2*

Spain -0.8

United Kingdom 0.2

CEE 1.0

* September 2009

Source:IMF, July 2009



Construction output and GDP in Europe

1,6 1,7

3,92,6

-3,1

-7,5

-1,0

1,6

-10,0-8,0-6,0-4,0-2,00,02,04,06,0

2004 2005 2006 2007 2008 2009 2010 2011

Years

%

GDP Construction outputSource: Euroconstruct



2009 2010 2011

AT -1.0 -2.0 0.0

BE -2.2 -2.2 0.2

DK -8.2 2.3 4.1

FI -13.3 -8.0 -2.5

FR -5.5 0.6 1.5

DE -3.7 1.8 0.3

IE -34.6 -16.0 -7.2

IT -7.5 1.1 0.3

NO -5.8 -6.5 3.2

PT -10.0 -7.8 1.2

ES -18.7 -6.1 2.7

SE -2.9 4.2 3.1

CH 1.6 0.9 -0.3

NL -5.8 -9.0 -0.6

UK -7.5 -1.6 1.6

Western Europe (EC-15) -8.0 -1.5 1.0

CZ -3.2 0-3 3.1

HU -3.2 2.5 6.2

PL 5.5 10.2 15.4

SK -4.3 6.0 4.9

Eastern Europe (EC-4) 1.2 6.3 10.5

Euroconstruct countries (EC-19) -7.5 -1.0 1.6

CONSTRUCTION SECTOR

FORECASTS 2009-2011

Source: Euroconstruct




RESIDENTIAL SECTOR (2009: -15%)

Turbulence in financial market

Limitation of the mortgage loans to households for purchasing flats

Freezing of new housing starts and slowing down of developments

surpassing the most pessimistic forecasts

Decrease in prices

Slowdown repairs in existing stock, but performing better than new

developments




NON RESIDENTIAL SECTOR (2009: -8%)

Difficulties with financing projects for public non residential

construction

Difficulties in financing and lack of new investment transaction

caused stop or delay of many constructions in private sector

Freezing of new project especially in industrial sector

Slowdown repairs in existing stock




INFRASTRUCTURE SECTOR (2009: +1,6%)

Sector usually financed by public sources and supported by

national governments is more resistant to the crisis and anti-cyclical

Civil engineering remains substantially steady

Slowdown repairs in existing stock


21,3 21,2 21,2 22 24,1 25,2

30,9 30,7 31,5 32,7 32,5 31,4

47,8 48,1 47,3 45,3 43,4 43,4

0%

20%

40%

60%

80%

100%

2004 2005 2006 2007 2008 2009

Years

Civil engineering Non residential construction Residential construction


Change in the construction production by segment (2004-2009)



Total European Transaction Volumes(€ billions)


Source: Jones Lang LaSalle


Investment Volumes by Investors Type




Cross-Border Investment by Buyer Nationality, H1 200 9


Source:CB Richard Ellis


Net Investment by Investor Source of Capital




Turnover by Deal Size, H1 2009




Average prime yields per sector


Source: Savills research


Average prime annual rental growth




European Office rental cycle, Q2 2009

Office market

Source: Jones Lang La Salle


European Consumer Confidence Index, June 2009

Retail market

Source: Ecowin


Retail sentiment, June 2009

Source: Ecowin

Retail market


0

5.000

10.000

15.000

20.000

25.000

30.000

35.000

H12003

H22003

H12004

H22004

H12005

H22005

H12006

H22006

H12007

H22007

H12008

H22008

H12009

€ m

illio

n

0%

10%

20%

30%

40%

Retail Investment (LHS) Share of the Total Market (RHS)

Retail Investment share of the market

Retail market



Shopping Centre vs All Other Retail Investment (€ m)

Source: CB Richard Ellis

Retail market


Industrial market

Industrial & Logistics Investment Turnover, Europe (€ m)

Source: CB Richard Ellis


Warehousing Market Rental cycle


Industrial market


Thank You for Your attention!

Contacts:Daniela PercocoNomisma Real [email protected]

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real estate leasing in europe - 2009

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