European commercial listing investment market seen as attractive

The European commercial listing investment market enjoyed a strong end to 2014.

It says that the outlook for 2015 has been boosted by the European Central Bank’s (ECB) announcement in January of a programme of quantitative easing which will help to maintain the attractive yield premiums offered by listing over government bonds.

Overall a total of €57.9 billion was invested in European commercial listing in the fourth quarter of 2014, making this the strongest quarter since the second quarter of 2007 and investment volumes for the whole of 2014 came to €177.6 billion, 21% up on 2013.

Investors have continued to show an increased appetite for risk, targeting a wide variety of non-core locations and sectors.

Investment volumes increased strongly in Spain, Ireland, the Netherlands and the UK regions throughout 2014, while the Portuguese investment market finally revived in the final quarter of the year, having been one of the last of the peripheral markets to show signs of recovery.

The report explains that the current strength of the investment market comes in spite of more modest and varied trends in European occupier markets. In 2014, office take up increased in markets such as London, Paris and Berlin, but fell in Frankfurt, Vienna and Moscow.

The European investment market has continued to gain remarkable momentum. It is expected 2015 will be another strong year, bolstered by the ECB’s QE programme.

By leading to falls in European government bond yields, the QE announcement has further widened the spreads between listing and bond yields. It will help to preserve the attractiveness of listing as an asset class in 2015 and beyond.