DNA of Real Estate tracks prime rents and yields in 46 cities across Europe, covering the key office, logistics and high street destinations. It has an overview of quarterly performance, and a summary of prime rents and yields for the cities and markets.
The latest Q2 2019 report, shows the European logistics sector continues to perform well with strong rental growth and investor demand driving down yield by 2bps, whereas yields in the European office and retail sectors remained flat.
The logistics sector saw prime rents grow 0.6% over the quarter and rising 2.8% year on year – its highest rate since March 2008.
The strongest growth remains in Central Eastern Europe (CEE) markets with rents 4.4% higher in Budapest and 2.7% in Warsaw.
The German city of Hamburg also posted strong growth with rents 3.4% higher over the quarter supported by a lack of stock and strong demand driven by a streamlining of distribution networks.
This quarter's takeaway from Nigel Almond, Head of Data Analytics:
“Strong occupational demand continued to drive prime European logistics yields 2bps lower, pushing the weighted average prime yield to a new record low of 5.66%. Most regions saw modest falls in yields over the quarter led by CEE where we have seen the strongest rental growth. Further falls are expected in a third of markets by year-end where low finance rates and favourable occupational markets support rental growth and yield compression.”
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