Study: Trend toward corporate investments in commercial real estate on the rise

  • 4 years ago

The quarterly investment market overview published by the consulting and investment management company JLL reports on current developments in the commercial real estate sector in Germany. According to JLL, the third quarter of 2019 was the strongest ever. This is because large-volume commercial real estate is particularly popular with investors with high liquidity reserves. Thus, JLL recorded a transaction volume of EUR 57.3 billion by the end of September. Five of the ten largest transactions of the year took place between July and September 2019.

An increasing share of real estate sales is accounted for by so-called participation transactions. Due to the lack of large-scale commercial real estate in Germany, equity investments offer investors a good opportunity to acquire real estate. These fulfill all the criteria for a real estate investment and forecast a good turnover with a corresponding interest rate. Large-volume office space is particularly in demand.

More than half of all sales are concentrated in Germany's top 7 investment centers. Berlin is leading the way, where sales have doubled compared with the previous year, and the trend is upwards. Sales in Munich and Cologne have also risen by several percentage points. There is also no sign of a break in the momentum on the commercial real estate market in the final quarter of 2019. According to JLL, a total transaction volume of EUR 75 billion would be realistic for 2019.

Source: JLL

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