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Poor economic outlook takes its toll on Europe’s commercial property market


30 Jan 2012


Euro & Finance
Sustainable Dev.

RICS Global Commercial Property Survey Q4 2011*

The weaker economic climate further hindered commercial real estate markets around the world during the last quarter of 2011. In Europe, while Germany, Poland and Russia continue to perform strongly, other markets such as France and the Netherlands have become increasingly nervous, says the latest RICS Global Commercial Property Survey issued today (30 January 2012). 

The report indicates that negative macro economic news hit confidence in an increasing number of countries around the world. This translated into falling tenant demand, rising supply and reduced investment activity in more than half of the countries surveyed. Despite concerns, indicators in China are still largely optimistic. The country remains amongst the strongest performers together with Canada, Brazil and Russia. 

In Europe, Germany continues to demonstrate resilience to the sovereign debt crisis and its accompanying economic slowdown. Respondents indicated positive occupier demand and still anticipate rising rents and investment activity, though at a slightly slower pace than at the end of last year. Results for the Polish and Russian markets are largely similar. Though rental expectations seem to be levelling off, both countries foresee rising capital values and investment activity.  

Elsewhere in Europe, on-going instability in financial markets means an increasing number of countries find themselves struggling. Amongst these, France records particularly disappointing results. The symptoms are unequivocal: rising supply, falling occupier demand and pessimistic indicators for the coming quarter. French respondents to the survey report a further drop in investment enquiries (from -13 to -24) and capital value expectations (from -12 to -34). The picture in the Netherlands and Italy is broadly similar.

Meanwhile the weakest markets in Europe – Greece, Portugal, the Republic of Ireland and Spain –continue to perform poorly, though indicators are falling at a more moderate pace than earlier in 2011.   

Commenting on the survey, Simon Rubinsohn, RICS Chief Economist, said:

“The prospect of an extended period of minimal growth, if not a retreat back into outright recession, is clearly weighing heavily on the sector across much of Europe in the wake of the ongoing turmoil relating to the sovereign debt crisis. However, the data shows that commercial real estate in some parts of the world continues to provide significant opportunities. In particular, the numbers  

demonstrate that sentiment remains generally upbeat in many of the faster growing economies, even if they are themselves likely to grow a little more slowly in 2012.“


Notes to Editors:

* The RICS Global Commercial Property Survey is a quarterly guide to the developing trends in commercial property investment and occupier markets around the world. Providing a snapshot of sentiment, the current edition details market conditions for the third quarter of 2011 based on information collected from leading international real estate organisations, local firms and other property professionals

NB: UK data that appears in the Global Commercial Property Survey is presented in a non seasonally-adjusted basis. For this reason, it differs from results in the RICS UK Commercial Market survey.

Net Balances: Net balance percents, or scores, are calculated by subtracting the numbers of respondents reporting ‘down’ from the number who reported ‘up’.

About the Survey: Available at, the RICS Global Commercial Property Survey is a quarterly guide to developing trends in the commercial property investment and occupier market. 

Respondents were asked to compare conditions in Q3 2011 to conditions in Q2 2011. Responses for this survey were collected until 23 September 2011 and amalgamated, at a country level, across the three real estate sub-sectors of offices, retail and industrial property to form a net balance reading for the commercial market as a whole. 

About RICS

RICS is the world’s leading qualification when it comes to professional standards in land, property and construction. In a world where more and more people, governments, banks and commercial organisations demand greater certainty of professional standards and ethics, attaining RICS status is the recognised mark of property professionalism.

Over 100 000 property professionals working in the major established and emerging economies of the world have already recognised the importance of securing RICS status by becoming members.

RICS is an independent professional body originally established in the UK by Royal Charter. Since 1868, RICS has been committed to setting and upholding the highest standards of excellence and integrity – providing impartial, authoritative advice on key issues affecting businesses and society. RICS is a regulator of both its individual members and firms enabling it to maintain the highest standards and providing the basis for unparalleled client confidence in the sector.


For further information: 

Gael Bassetto

Communications Officer

T: +32 (0)2 289 25 30