__MAIN_TEXT__

Page 1

THE DANISH PROPERTY FEDERATION MARKET STATISTICS – VACANCY COVERING THE PROFESSIONAL INVESTMENT PROPERTY MARKET IN DENMARK

January 2016

WEB REPORT

Investment properties increase economic growth in Denmark In 2016, the Danish Economic Councils expect an economic growth of 1.1 percent. The relatively low growth rate is still a positive indicator of a Danish economy going moderately forward, which imply a further demand for vacant capacity within retail, office and industry. The unemployment rate continues at a low level as the gross unemployment rate was 4,5 percent in November 2015 and the Danish Economic Councils expect employment to increase with 26.000 persons in 2015.

quarter and are included in the statistic. At the same time, the statistical material has been expanded due to more participants which can influence the total result. The new office rentals contribute to an increasing economic vacancy rate for office rentals of 0.6 percentage points compared to October 2015. Another explanation to the increase in the economic vacancy rate is the vacancy increase for existing office rentals in the statistics by 0.3 percentage points. The most important reason is however, that more leases are vacant compared to the amount of new rentals in January. Each of the effects contributes with 1.8 percentage points increasing the vacancy rate, respectively – 1.3 percentage points decreasing the vacancy rate. Finally, there are some minor effects that in total with the above means that the economic vacancy for office increases with 1,0 percentage points to a total of 13.0 percent.

The availability of commercial rentals is an essential factor for economic growth as production and commerce need properties and squaremetres. At the same time there are approximately 100.000 employed within commercial properties in Denmark. A little more than 50 percent are employed within construction, development and improvements while almost 45 percent are employed within property management, rentals and maintenance. A smaller part of the employed work with portfolio management and transactions. In total, the share of employees within commercial properties is higher than the group of employees within the banking sector in Denmark. This also implies, that when the Danish economy is doing well, more activity will lead to higher employment within commercial properties and further economic growth.

Spatial vacancy is higher than economic vacancy rate While the average economic vacancy rate is 9.8 percent in January 2016, spatial vacancy rate is 11.1 percent. Spatial and economic vacancy rates for residential leases of 2.9 and 3.1 percent are considered low. For commercial leases the spatial vacancy rate is higher than economic vacancy rate, which means that is it typically the cheap space that is hard to rent. Spatial vacancy for industrial rentals show positive development as the rate decrease by 0.1 percentage points compared to last quarter and a yearly decrease of 4.2 percentage points. The spatial vacancy rate for retail is slightly increasing with 0.2 percentage points compared to last quarter and 0.6 percentage points compared to last year. Spatial vacancy rate for office is 14.8 percent which is higher than for both residential, retail, and industrial rentals. As the economic growth increases, there will be vacant office space available. In other words according to vacancy rates it pays to construct residential properties compared to office properties.

Slight increase in economic vacancy rate Unfortunately, the economic growth has not meant a lower economic vacancy in Denmark during the latest quarter. Compared to last quarter the economic vacancy rate has decreased by 0.2 percentage points for industrial and 0.4 percentage points for residential rentals. The economic vacancy rate is unchanged for retail while there is a disappointing increase of 1.0 percentage points for office rentals. There are several reasons for the economic vacancy rate increase for office rentals. A significant reason is that office rentals under development or under construction have been finished since last

Table 1. Vacancy rates January 2016

Economic vacancy rate Vacancy (percent)

Quarterly change (percentage points)

Office

13.0

Retail

8.0

Industry

Space vacancy rate

Annual change (percentage points)

Vacancy (percent)

Quarterly change (percentage points)

Annual change (percentage points)

1.0

0.6

14.8

0.5

0.5

0.0

-0.1

8.4

0.2

0.6

13.2

-0.2

-2.5

14.2

-0.1

-4.2

Residential

3.1

-0.4

0.5

2.9

-0.2

0.0

Total

9.8

0.1

0.2

11.1

-0.1

-0.2

Source: The Danish Property Federation. Rem.: The vacancy rate covering all sectors also include rent and space for other commercial sectors and secondary premises.

Published by the Danish Property Federation


THE DANISH PROPERTY FEDERATION MARKET STATISTICS – VACANCY COVERING THE PROFESSIONAL INVESTMENT PROPERTY MARKET IN DENMARK January 2016

Office

WEB REPORT

Decreasing economic vacancy in Southern Denmark The economic vacancy rate in Southern Denmark Region is 10.6 percent, which is 2.6 percentage points lower than October 2015 and 5.6 percentage points lower compared to January 2015. In Odense, the economic vacancy rate has decreased by 1.0 percentage points to 13.2 percent, while the spatial vacancy rate decrease is limited. The Sealand Region also has a positive development. Here the economic vacancy rate has dropped 2.4 percentage points and spatial vacancy rate by 3.2 percentage points. A higher spatial vacancy in Odense and in the Sealand Region means that in average vacant leases are cheaper than the rented. This implies that newer and well-situated offices are rented more than older and secondary situated offices. The economic vacancy rate has increased in and around Copenhagen and Aarhus. In Aarhus, the economic vacancy rate increased by 1.3 percentage points the last quarter, while the increase was 6.6. percent in Northern Sealand. This means that both economic as well as spatial vacancy is still above national average in the Capital Region and the Mid Jutland Region.

Retail

Unchanged economic vacancy at national level The national economic vacancy is unchanged compared to last quarter, meanng that the economic vacancy rate for retail rentals remains at 8.0 percent in January 2016. Since last year there has been a decrease of 0.1 percentage points in the vacancy rate. Regionally, the economic vacancy rate show positive developments in the Capital Region, the Sealand Region, and the Northern Jutland Region. Within the Capital Region, Copenhagen CBD and Other Copenhagen & Area likewise continue a positive development and decreases with 0.2 percentage points to 1.2 and 9.1 respectively. The Sealand Region has a vacancy rate of 12.0 corresponding to a decrease of 0.5 percentage points since October and 0.1 percentage points since January 2015. Both Eastern Sealand and Western & Southern Sealand show positive tendencies regarding quarterly change and descrease by 0.3 and 0.2 percentage point respectively, compared to last quarter. The Northern Jutland Region is also doing well and has experienced a decrease of 0.5 percentage points since last quarter and 2.8 percentage points since last year. It is the Sealand Region which experience a decreasing spatial vacancy compared to last quarter. The rest of the regions either experience an increased og unchanged level. The Sourthern Denmark Region and the Mid Jutland Region both experience a slight increasing vacancy rate. The Southern Denmark Region has an increase vacancy rate of 1.4 percentage points corresponding to an economic vacancy rate of 6.9. Compared to last year, it is an increase of 1.0 percentage points. The Mid Jutland Region lies a bit higher with a vacancy rate of 7.8 based on af quarterly change of 1.1 percentage points.

Published by the Danish Property Federation


THE DANISH PROPERTY FEDERATION MARKET STATISTICS – VACANCY COVERING THE PROFESSIONAL INVESTMENT PROPERTY MARKET IN DENMARK January 2016

Industrial

WEB REPORT

The positive development continues There are still vacant industrial rentals throughout the country. The national economic vacancy rate is 13.2 percent, but the economic vacancy is decreasing. Industrial rentals develop in the right direction looking at the last two years as a whole, as can be seen in figure 1. Over the last two years there has been a decrease of 0.6 percentage points for industrial rentals, while there is a decrease compared to last quarter by 0.2 percentage points. In the Capital Region there is a decrease of 0.4 percentage points compared to last quarter and of 2.3 percentage points compared to last year. The economic vacancy rate for industrial rentals in the Capital Region is a little above the national average of 14.5 percent. The Sealand Region has an economic vacancy rate of 17.4 percent. In the Southern Denmark Region the economic vacancy rate is 9.7 percent, which is a decrease of 1.4 percentage points compared to last quarter and 6.8 percentage points compared to last year. In the Mid Jutland Region there is a slight increase in economic vacancy, but the level is still low with an economic vacancy rate of 7.1 percent.

Residential

Still high demand In general the vacancy rates for residential rentals are low. Compared to October, the economic vacancy rate has decreased by 0.4 percentage points at national level and spatial vacancy has decreased by 0.2 percentage points. This means that the vacancy compared to rental value is 3.1 percent, while vacancy measured in vacant squaremetres is 2.9 percent in January 2016. As in October, the level ist still slightly increasing on an annual basis. Compared to January 2015, the economic vacancy increased by 0.5 percentage points. Spatial vacancy is at the same level as January 2015. The highest quarterly decrease is in Aarhus with 1.5 percentage points, corresponding to a vacancy rate level of 3.9 percent and a total economic vacancy rate of 4.1 percent for the Mid Jutland Region. In the Capital Region, the vacancy level is 3.2 percent, which is 0.3 percentage points lower than last quarter. This is especially due to a decrease in Other Copenhagen & Area, where the economic vacancy rate decreased by 0.7 percentage points to 2.9 percent in January 2016. In January 2016, the Sealand Region experiences a decrease in vacancy rate of 0.8 percentage points. The lowest vacancy on regional level is in the Northern Jutland Region, where the vacancy rate is 1.5 percent. Within the region, Aalborg has an economic vacancy rate of 1.2 percent.

Published by the Danish Property Federation


THE DANISH PROPERTY FEDERATION MARKET STATISTICS – VACANCY COVERING THE PROFESSIONAL INVESTMENT PROPERTY MARKET IN DENMARK January 2016 N

Ø

V

S

WEB REPORT

Geographical overview Northern Jutland Region

Aalborg

Mid Jutland Region

Aarhus Northern Seeland Capital Region

Other Copenhagen & area

Triangle area Seeland Region

Southern Denmark Region

Odense

Western and Southern Seeland

Copenhagen CBD Eastern Seeland

Source: The Danish Property Federation.

Copenhagen CBD

Christiansborg

Copenhagen CBD covers the zip codes: 900, 1000-1559,

Tivoli

1562-1609, 1611-1614. Source: The Danish Property Federation.

Published by the Danish Property Federation


THE DANISH PROPERTY FEDERATION MARKET STATISTICS – VACANCY COVERING THE PROFESSIONAL INVESTMENT PROPERTY MARKET IN DENMARK January 2016

WEB REPORT

Table 2. Office Economic vacancy rate Quarterly change (percentage points)

Annual change (percentage points)

13.3

1.2

0.7

January 2016 (percent) Capital Region total Copenhagen, CBD

Space vacancy rate Quarterly change (percentage points)

Annual change (percentage points)

15.1

0.7

0.7

January 2016 (percent)

9.0

0.1

-2.5

9.6

0.0

-2.9

Other Copenhagen & area

14.0

1.3

1.4

15.7

0.6

1.2

Northern Seeland

24.1

6.6

6.4

24.7

6.0

6.9

Seeland Region Southern Denmark Region Odense Mid Jutland Region Aarhus Other Mid Jutland Northern Jutland Region Total

8.6

0.3

-2.4

11.5

0.6

-3.2

10.6

-2.6

-5.6

14.1

-3.7

-4.9

13.2

-1.0

-0.2

18.6

-0.2

-0.3

13.8

1.1

2.9

15.9

1.0

2.6

15.1

1.3

4.0

16.7

1.3

3.6

9.0

0.5

-1.5

13.1

0.1

-0.9

10.2

0.9

2.8

11.9

0.5

2.0

13.0

1.0

0.6

14.8

0.5

0.5

Source: The Danish Property Federation.

Table 3. Retail Economic vacancy rate

Space vacancy rate

January 2016 (percent)

Quarterly change (percentage points)

Capital Region total

7.5

-0.3

-0.8

Copenhagen, CBD

1.2

-0.2

-1.2

Other Copenhagen & area

9.1

-0.2

Northern Seeland

Quarterly change (percentage points)

Annual change (percentage points)

7.7

0.0

-0.5

1.0

-0.4

-1.3

-0.8

9.2

0.3

-0.6

Annual change (percentage points)

January 2016 (percent)

11.2

0.8

2.3

12.2

0.8

3.6

12.0

-0.5

-0.1

10.4

-0.3

-0.8

Eastern Seeland

10.3

-0.3

-1.5

8.2

-0.5

-0.7

Western & Southern Sealand

16.5

-0.2

3.9

13.8

0.3

-2.0

6.9

1.4

1.0

6.7

0.8

-0.7

8.1

1.5

1.8

7.5

0.2

-0.5

7.8

1.1

3.9

10.2

1.4

6.8

5.5

1.2

0.5

5.3

0.4

0.6

Seeland Region

Southern Denmark Region Triangle Area Mid Jutland Region Aarhus

13.8

2.2

18.6

4.7

Northern Jutland Region

Other Mid Jutland

8.3

-0.5

-2.8

*

10.2

0.4

1.5

*

Total

8.0

0.0

-0.1

8.4

0.2

0.6

Source: The Danish Property Federation.

Published by the Danish Property Federation


THE DANISH PROPERTY FEDERATION MARKET STATISTICS – VACANCY COVERING THE PROFESSIONAL INVESTMENT PROPERTY MARKET IN DENMARK January 2016

WEB REPORT

Table 4. Industrial Economic vacancy rate January 2016 (percent)

Space vacancy rate

Quarterly change (percentage points)

Annual change (percentage points)

January 2016 (percent)

Quarterly change (percentage points)

Annual change (percentage points)

Capital Region total

14.5

-0.4

-2.3

14.9

-0.5

-4.1

Copenhagen, CBD

14.9

3.0

-3.7

25.6

1.5

0.1

Other Copenhagen & area

14.6

-0.9

-2.0

14.0

-0.8

-4.1

Northern Seeland

12.7

2.5

-4.7

13.8

0.6

-7.0

Seeland Region

17.4

1.8

-4.2

18.0

3.5

-17.9

Southern Denmark Region

9.7

-1.4

-6.8

16.5

-0.5

-6.6

Mid Jutland Region

7.1

0.7

0.1

9.4

1.0

0.4

7.8

-0.2

-6.6

8.8

-0.5

-10.3

13.2

-0.2

-2.5

14.2

-0.1

-4.2

Aarhus Total Source: The Danish Property Federation.

Tabel 5. Residential Economic vacancy rate January 2016 (percent)

Quarterly change (percentage points)

Space vacancy rate

Annual change (percentage points)

January 2016 (percent)

Quarterly change (percentage points)

Annual change (percentage points)

Capital Region total

3.2

-0.3

1.0

2.9

-0.2

0.6

Copenhagen, CBD

5.0

-0.1

0.0

4.4

-0.1

-0.2

Other Copenhagen & area

2.9

-0.7

0.9

2.7

-0.5

0.6

Northern Seeland

2.7

1.2

1.9

2.6

1.1

1.5

4.3

-0.8

3.5

5.4

-0.8

4.2

Eastern Seeland

2.7

-0.9

2.2

2.6

-0.8

1.9

Western and Southern Seeland

4.9

-0.8

3.9

6.3

-0.9

4.8

1.9

0.3

-0.6

1.9

0.3

-0.6

Odense

1.7

0.4

0.8

1.7

0.4

1.0

Triangle area

2.3

0.2

0.1

2.2

0.5

0.2

Other southern Denmark

1.8

0.5

-2.0

1.8

0.3

-2.2

4.1

-1.1

-2.3

3.7

-0.7

-5.2

Aarhus

3.9

-1.5

-2.2

3.2

-1.1

-1.3

Other Mid Jutland

4.9

0.5

-3.0

4.9

0.6

-16.0

1.5

0.4

0.0

1.9

0.4

0.1

Aalborg

1.2

0.4

-0.1

1.3

0.4

0.0

Other Northern Jutland

5.1

0.6

1.8

7.0

0.3

1.4

3.1

-0.4

0.5

2.9

-0.2

0.0

Seeland Region

Southern Denmark Region

Mid Jutland Region

Northern Jutland Region

Total Source: The Danish Property Federation.

Published by the Danish Property Federation


THE DANISH PROPERTY FEDERATION MARKET STATISTICS – VACANCY COVERING THE PROFESSIONAL INVESTMENT PROPERTY MARKET IN DENMARK January 2016

WEB REPORT

Figure 1. Development in vacancy rate Percent

Percent 25,0

25 25,0

20,0

20

20,0

15,0

15

15,0

10,0 10

10,0

5,0 5

0 0,0 0,0

Jan. Jan.Jan. Apr. Apr.Apr. Jul. Jul. Jul. Oct. Oct.Oct. Jan. Jan.Jan. Apr. Apr.Apr. Jul. Jul. Jul. Oct. Oct.Oct. Jan. Jan.Jan. Apr. Apr.Apr. Jul. Jul. Oct. Jul. Oct.Oct. Jan. Jan.Jan. Apr. Apr.Apr. Jul. Jul. Oct. Jul. Jan. Oct.Oct. Apr. Jan.Jan. Jul. Apr.Apr. Jul. Oct. Jul. Jan. Oct.Oct. Apr. Jan.Jan. Jul. Apr.Apr. Oct. Jul. Jul. Jan. Oct.Oct. Apr. Jan.Jan. Jul. Apr.Apr. Oct. Jul. Jan. Jul. Oct.Oct. Apr. Jan.Jan. Jul. Apr.Apr. Oct. Jul. Jan. Jul. Oct.Oct. Apr. Jan.Jan. Jul. Oct. Apr.Apr. Jan. Jul. Jul. Apr. Oct.Oct. Jul. Jan.Jan. Oct. Apr.Apr. Jan. Jul. Jul. Apr. Oct.Oct. Jul. Jan.Jan. Oct. Apr.Apr. Jan. Jul. Jul. Apr. Oct.Oct. Jul. Jan.Jan. Oct. Apr.Apr. Jan. Jul.tOct. tOct. Apr. Jul. Oct. Jan.Oct. Jul. Jan. Apr. Jan.Jan. Oct. Apr. Jul.Apr. Apr. Jan. Jul. Apr. Oct. Oct. Jul.Apr. Jul. Jul. Jan.Jan. Oct. Jul. Oct. Oct. Apr.Oct. Jan. Apr. Jan.Jan. Jul.Jan. Apr. Jul. Apr. Oct.Apr. Jul. Oct. Jul.Apr. Jul. Jan. Oct. Jan. Jul. Oct. Jan. Apr.Oct. Apr. Oct. Jan. Apr. Jul.Jan. Jul. Jan. Jul. Apr. Oct.Apr. Oct. Apr. Jan. Jul. Jan. Jul. Jul. Apr.Oct. Apr. Oct. Jul.Oct. Jul. Jan. Jan. Jan. Apr.Apr. Jul. Jul. Oct.Oct.

5,0

2000 2000 2000

2001 2001

2002 2002

2000

2001

2002

2003 2003

2003 Office Office

2004 2004

2004

20052005

20062006

2005 Retail Retail

2006

20072007

2007

2008 2008 2009 2009 2010 2010 2011 2011 2012 20122013 20132014 2011 2012 2013 2010 2008 2009 Industrial Residential Total

Industrial

Residential

2014 2015 2014

2015

2015

Total

Source: The Danish Property Federation and own calculations based on data from IPD Danish Property Index and Oline-ED statistics. Rem.: Data from January 2014 and forward is from the Danish Property Federation. From 2001 to 2013, data from IPD Danish Property Index has been processed based on differences in level in 2014. In year 2000, office data from Oline-ED Statistics has been included. Methods are not identical, which is why tere is a gap between October 2013 and January 2014. From January 2014, data is quarterly and before this data is annual. From 2014 there is a larger base of data.

Published by the Danish Property Federation


THE DANISH PROPERTY FEDERATION MARKET STATISTICS – VACANCY COVERING THE PROFESSIONAL INVESTMENT PROPERTY MARKET IN DENMARK January 2016

WEB REPORT

About the Market Statistics This web report is published on 10 February 2016. Next planned publishing is mid May 2016. The report has been based on data from: Aage Larsens Boligudlejning, Aberdeen Asset Management, Alm. Brand, AP Pension, ATP, Bevica Fonden, Carlsbergfondet, CEJ Ejendomsadministration, Coller Capital, CS Pensionsfond, C.W. Obel Ejendomme, DADES, Danica, Dansk Sygeplejeråd, Danske Bank, DATEA, DEAS, DIP, Ejendomsselskaberne Grønløkkevej 10, Frederiksberg Fonden, Færchfonden, Grosserer Schiellerup og Hustrus Fonde, Gudbjørg og Ejnar Honorés Fond, Højgaard Ejendomme, Industriens Pension, Jammerbugt Kommune, Jeudan, Jorcks Ejendomsselskab, JØP, Kramers Legat, LB Forsikring, Lægernes Pensionskasse, Lærernes Pension, Majbritt Birch Ejendomsadministration, Niam, Nordea Ejendomme, Nordea Liv og Pension, North Property Asset Management, NREP, PBU, PenSam, PensionDanmark, Pensionskassen for Farmakonomer, PFA, PKA, Sampension, SEB, SPG Omsorg DK1, Steen & Strøm, Taurus Ejendomsadministration, TDC Pensionskasse, Topdanmark, Tryg, Unipension, Valad and 2 + 3 Ejendomme. The portfolios have approx. 60.000 rentals corresponding to an annual lease value of DKK 15.7 bn and 13.4 m m2. In order to compare, the statistical base in January 2015 had an annual lease value of DKK 12.0 bn and 9.7 m m2. The base of the economic vacancy is the actual rent. The economic vacancy is defined as: Sum of actual rent in all vacant leases divided with the sum of actual rent i both occupied and vacant rentals. The Market Statistics is based on quarterly processed property data for rentals and vacancies within the period in question. This web report has been closed per 31 December 2015 and is called January 2016. Quarterly change is from January 2016 (closed per 31 December 2015) compared to October 2015 (closed per 30 September 2015). Aanual change is from January 2016 (closed per 31 January 2015) compared to January 2015 (closed per 31 January 2014). We have chosen not to publish data, where the data is not suffiecient to give valid and representative results or combinations if only one or very few portfolios are represented. For further information regarding this web report, please contact Chief Economist Morten Marott Larsen, mml@ejendomsforeningen.dk, phone +45 28 45 56 51.

Published by the Danish Property Federation

Profile for EjendomDanmark

EjendomDanmark marked statistics - Vacancy (January 2016)  

Investment properties increase economic growth in Denmark

EjendomDanmark marked statistics - Vacancy (January 2016)  

Investment properties increase economic growth in Denmark

Profile for hverve