Highlights - Colliers International

Transcription

Highlights - Colliers International
Capital
Flows
Investment
Quarterly
Review Report
EUROPE
| Q1 2014
EMEA | Investment
Q1 2014
Accelerating success.
Highlights
• Institutions looking outside core markets.
• Investment volumes lower in Q1 2014 compared to
Q1 2013, primarily due to lack of available product
although Germany has seen its largest volumes since
2007.
• NPLs portfolios seeing strong appetite.
• Uncertainty in Eastern Europe may weigh on cross border
investment.
• SWFs and global institutions appetite for safe-haven
property continues unabated.
After a strong end 2013, preliminary RCA figures for Q1 2014
point to lower volumes ( €29 bn vs. €38 bn in Q1 2013) but our
view is that this is due to lack of available product and certainly
not due to appetite from buyers with many transactions
expected to complete in April 2014.
• Some Malaysian and Chinese capital starting to increase risk appetite and look at shopping centres
in UK with strong local partners.
• Private Equity increases activity in peripheral
countries: the year of Spain?
At €19.8 bn, cross-border investment accounted for nearly 70%
of total investment, against 45% in Q1 2013.
Key Cross Border Transactions - Q1 2014
COUNTRY
France
CITY/REGION
Paris
PROPERTY
La Madeleine
TYPE
BUYER
SELLER
ESTIMATED VALUE
Office
NBIM (Norges)
BlackRock
€425m
FMS
Wertmanagement
€1 bn
Germany
Hesse
Leo I portfolio
Office
Consortium led by
Patrizia
Germany
Brandeburg, Dresden
4 properties
(Christie portfolio)
SC
Morgan
Stanley+Redos
M&G
(Prudential)
€400m
Germany
Dusseldorf
former WestLB HQ
Office
Blackstone
Portigon
€350m
Ireland
Dublin
Central Park
Office + Land
PIMCO+Green REIT
NAMA
€310m
Corio
€213m
NL
Various
10 assets
SC
Mount Kellet CM +
Sectie5 Investments
Spain
Getafe-Zamora
Nassica Retail Park
– Vista Alegre Retail
Park
Retail Park
KKR
British Land
€100m
UK
London Wandsworth
Ram Brewery
Development site
Greenland Group
(China)
Minerva
€730m
UK
Various
DFS Portfolio
Retail Warehouse +
Logistics
PIMCO/London Metric Delphi Properties Ltd €140m
UK
London
1 St Martin’s-leGrand, EC2
Office
Ho Bee Investment
(Singapore)
Nomura
€207m
France, Germany,
Poland
Various
Portfolio
Logistics + Land
PSP (Canadian)
+ SEGRO
Tristan Capital
Partners + AEW
Europe
€470m
Source: Colliers International, RCA, various
Global Cross Border Flows - Q1 2014
€4.6bn
€2.1bn
€0.6bn
€8.9bn
North
America
€2.1bn
€1.6bn
Europe
€2.3bn
Asia
Middle
East
€0.3bn
€0.6bn
Australia &
New Zeland
Source: RCA
Safe-haven markets, led by London and Paris, continued to attract the bulk of cross-border capital, and remain the preferred target of SWFs and global insurance companies
seeking stable and secured incomes. This is highlighted by
LIM winning a mandate to spend £200 m equity in Paris for
Samsung Insurance.
Although investment volumes are down primarily due to lack
of product, Germany has seen its largest volumes since 2007.
German Buyers are very active in their home market totalling
49% of all transactions, however, we are seeing international
buyers target the large transactions including Blackstone
buying former WestLB HQ in Dusseldorf for €350m and Morgan
Stanley buying a portfolio of four shopping centres in East
Germany for approximately €400m.
Asian Investment Expands
London continues to top Asian investors’ preferences,
particularly new entrants, with City offices most en vogue. In one of its first ventures in the London property market, a Taiwanese Insurance Company, rumoured to be Cathay Life, is in discussions to acquire a City of London investment.
Sources suggest this may be Delancey and Area’s Walbrook
building which is multi-let for an average of ca. 14 years. If confirmed, the pricing is likely to be in the order of £400 m,
4.75% net initial yield.
Chinese insurance companies like the Taiwanese, now allowed
to invest outside their domestic market, represent another
source of fresh money rapidly making its way into European
property, with again London as the main entry point. A well-known Chinese insurance company is said to be looking to spend approximately £800m in London’s Canary Wharf.
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At the same time, there are signs of Asian investment becoming
more diversified and going up the risk curve in asset class,
despite remaining UK-centric. Some Asian investors have begun
to widen their focus outside London to regional assets.
These include the proposed purchase of a 50% stake in Cabot
Circus shopping centre in Bristol by China’s Gingko Tree/AXA
IM and Malaysia’s EPF/CBREGI rumoured acquisition of Fulham
Broadway and Hammersmith Broadway shopping centres in
West London. This trend allows Asian investors to invest with
strong local partners in an asset class offering large lot sizes
which are increasingly scarce for other asset classes.
Periphery Market Appeal Increasing
Partly reflecting growing competition from non-EU buyers, European institutions in Q1 continued to feature more
prominently in less “crowded” markets within Europe’s core.
Notable recent deals saw DEKA buying a prime office property
in Amsterdam (Symphony) and involved in an €176m SLB
in Helsinki. However, signalling a shift in dynamics, we are
also starting to witness continental institutions look at core
opportunities in more opportunistic countries like Italy, Spain
and the Netherlands.
Private Equity funds are increasingly taking country risk
believing the likes of Spain and Italy have now bottomed and
will get better. It’s telling that North American buyers, led by
equity funds, increased their acquisitions by 353% across the
peripherals (Portugal, Italy, Ireland, Greece and Spain) last year.
The Netherlands is also benefitting from renewed interest, with
Mount Kellet Capital Management recently snapping up a portfolio of 10 regional retail assets from Corio in a joint venture
with Sectie5 Investments. Capital Flows Quarterly Report | Q1 2014 | Colliers International
Likewise, foreign investors’ push into the peripheral
markets’ NPLs segment, led by PE and investment banks,
has accelerated. In Spain, Sareb’s sell off of distressed loan
portfolios has been attracting a great deal of interest. More
activity is expected going forward with, among others,
Commerzbank seeking to dispose of Eurohypo’s €5 bn legacy
loans portfolio. Cerberus have just won Project Eagle, NAMA’s
entire Northern Irish loanbook.
In light of the level of interest witnessed so far, 2014 seems
increasingly set to be the year of Spain, after Ireland in 2013.
However, the lack of stock and little readily available debt may
slow transactions after volumes rose 88% last year.
Total European Property Investment
350
300
250
200
bn €
This is one of the first transactions of its kind, involving a foreign
buyer, since the economic recession.
150
100
50
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In CEE, uncertainty linked to the Ukraine crisis is likely to weigh
negatively on the region, particularly Russia, and reinforce the focus on Poland. In Q1 2014, Warsaw was the fourth most
active cross-border market after Paris, London and the Ruhr
area. With Western Europe returning to positive GDP growth
rates we, nonetheless, expect cross-border capital to be
focussed on opportunities in the West.
2007
Q1
2008
2009
Q2
2010
Q3
2011
2012
2013
2014
Q4
Source: RCA
Lipowy Office Center (Bank Pekao HQ) - Warsaw
BUYER WP Carey
SELLER CA Immo AG, advised by Colliers International Q1 2014
PRICE € 115m
For more information, please contact:
Richard Divall
Head of Cross Border Capital Markets | EMEA
TEL +44 20 7487 1605
richard.divall@colliers.com
Bruno Berretta
Senior Research Analyst EMEA
TEL +44 20 7344 6938
bruno.berretta@colliers.com
Colliers International EMEA
50 George Street
London W1U 7GA, United Kingdom
TEL +44 20 7935 4499
Copyright © 2014 Colliers International.
The information contained herein has been obtained from sources deemed reliable. While every reasonable effort has been made to ensure its accuracy, we cannot guarantee it.
No responsibility is assumed for any inaccuracies. Readers are encouraged to consult their professional advisors prior to acting on any of the material contained in this report.
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Capital Flows Quarterly Report | Q1 2014 | Colliers International