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

July 2016

Results

WEB REPORT

increased by 0.3 percentage point compared to last quarter. One explanation is the high growth in e-commerce – which is seen in Denmark as well as abroad – and this puts pressure the most challenged parts of the retail sector. In July, a significant part of the increased vacancy for retail lies within larger leases in shopping centres. This is e.g. the case in the Zealand Region, where the retail vacancy has increased by 3.0 percentage points during the last quarter.

• Decrease in economic vacancy • Office vacancy still above average • Higher vacancy for retail • Another decrease in vacancy for residential

Economic vacancy rate decrease by 0.2 percentage points

Low vacancy rate for retail despite increase The positive development in overall vacancy is maintained by the low level interest rates and an increased economic activity leading to higher levels of investments and continuous high demand for residential. Thus, the vacancy for Danish investment properties in July 2016 has dropped to the lowest level since the start of the market statistics in January 2014. The total economic vacancy is 9.4 percent while the spatial vacancy is 10.1 percent. Another factor contributing to a continuous progress is an increased private consumption. In June, Statistics Denmark published that the retail sale increased with almost two percent in three months. The increase in consumption especially comes from other goods than food and fast-moving consumer goods, where e.g. clothing has increased with six percent. Nonetheless, retail stands out in July 2016, as the vacancy level has

In July, the national economic vacancy is 9.4 percent corresponding to a decrease of 0.2 percentage points compared to April and 0.5 percentage points compared to last year. The positive development is limited by the fact that vacancy for office of 12.7 percent has been almost permanent during the latest quarters and still is considered to be above the long-term level, cf. figure 1. In addition, there is a small increase in the vacancy for retail implying an average increase of 0.2 percentage points every quarter since October 2015. The decrease in the total economic vacancy compared to last quarter is mainly due to a decrease in residential and to some extent industry. The economic vacancy for residential continues to decrease throughout 2016 with 0.3 percentage points in July which is why the low level from July 2015 of 2.6 percent is almost maintained.

Table 1. Vacancy rates in July 2016

Economic vacancy rate Vacancy (percent)

Quarterly change (percentage points)

Annual change (percentage points)

0.1

0.4

Spatial vacancy rate Vacancy (percent)

Quarterly change (percentage points)

Annual change (percentage points)

-0.2

0.6

Office

12.7

Retail

8.6

0.3

0.2

8.2

0.4

0.2

Industry

12.4

-0.9

-1.8

12.5

-1.1

-3.1

Residential

2.8

-0.3

0.1

2.6

-0.2

0.1

Total

9.4

-0.2

-0.5

10.1

-0.5

-1.2

14.4

Source: The Danish Property Federation. 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 July 2016

Overall, the vacancy for industry has had a decreasing tendency since January 2015 and the positive development is supported by a decrease of 0.9 percentage points in July. The improvement is especially due to a higher extent of industry rentals in Copenhagen and area.

WEB REPORT

Compared to the last quarter, the spatial vacancy rate for industry decreases with 1.1 percentage points to 12.5 percent in July 2016 and with 3.1 percentage points compared to last year. In July 2014 the level was 17.4 percent. Within the different sectors, it is only retail which experiences an increased spatial vacancy. 8.2 percent of all retail square metres is vacant in July 2016. This is a quarterly increase of 0.4 percentage points and mainly due to vacancy in several larger leases compared to last quarter. 14.4 percent office space is vacant in July 2016, which is a decrease of 0.2 percentage points compared to April 2016.

Still fewer vacant square meters Compared to April, the total spatial vacancy rate decreases by 0.5 percentage points to 10.1 percent. Compared to last year, the level is 1.2 percentage points lower, and the share of rented square metres is at the lowest level measured in the market statistics. The overall decrease in spatial vacancy is due to an increase in industrial rentals, showing a significant improvement since the start of the market statistics in January 2014.

Figure 1. Development in economic vacancy rate Percent 25,00

20,00

PROCENT

15,00

Percent 25,0

20,0

15,0 10,00

10,0

5,00

5,0

0,0

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

0,00

2000

2000

2001

2001

2002

2002

2003

2003

2004

Office

2004

2005

2005

2006

Kontor Retail

2006 Butik

2007

2007

2008

2008

Industry Industri

2009 Bolig

2009

2010

2010

2011

I altResidential

2011

2012

2012

2013

2013

2014

2014

2015

2015

2016

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 is 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 there is a gap between October 2013 and January 2014. From January 2014 data is quarterly and before this annual. From 2014 there is a larger base of data.

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

Office

WEB REPORT

Almost unchanged vacancy level The economic vacancy for office increases with 0.1 percentage points compared to April and is 12.7 percent in July. During the last three quarters, the vacancy rate has been reasonable stable but is considered above the long-term vacancy level. The share of vacant space for office is at 14.4 percent this quarter, which corresponds to a decrease of 0.2 percentage points compared to last quarter. As seen in table 2, the economic vacancy rate for office is typically a couple of percentage points below the spatial vacancy rate. This difference is reduced for most of the geographical areas compared to last quarter indicating that more cheap office space is rented out. This tendency can be seen in Copenhagen CBD (Central Business District) where the economic vacancy for office increases with 0.3 percentage point, while the spatial vacancy rate decreases with 0.1 percentage point. At regional level, the Capital, Zealand, and Mid Jutland experience quarterly increases in the economic vacancy rates of 0.1, 0.3, and 1.4 percentage points respectively. The vacancy in the Southern Denmark Region is stable, while the Northern Jutland Region as the only region experience a decrease of 0.7 percentage points. Four out of five regions have increased vacancy rates compared to July last year. The Southern Denmark Region is a positive exception. Here the economic vacancy decreases with two percentage points, while the spatial vacancy decreases with 2.7 percentage points.

Retail

Minor increase in vacancy rates The retail vacancy rate has increased for the third quarter in a row. In July, the economic vacancy rate is 8.6 percent, while the spatial vacancy rate is 8.2 percent. The share of lost rental income and rented square metres is thereby increased by 0.3 and 0.4 percentage points compared to April and 0.2 percentage points compared to last year. The increased vacancy is primarily due to increased vacancy for existing retail leases in Eastern Zealand and in West- and South Zealand. The changes mean that the economic vacancy rate in the Zealand Region increases with 3.0 percentage points compared to last quarter to 14.8 percent and the spatial vacancy increases with 2.1 percentage points to 12.9 percent. Thus, the vacancy in the region is almost doubled compared to the Capital Region, where the vacancy rates are at 7.5 and 6.9 respectively. In Copenhagen CBD, the vacancy has increased a little since April but the level still indicates that this part of the country has a high demand for retail leases. In the Southern Denmark Region, economic vacancy decreases to 8.6 percent corresponding to an improvement of 0.9 percentage points compared to last quarter. Aarhus experiences the largest decrease. The economic vacancy is 4.3 percent, which is 1.1 percentage points lower than last quarter and 1.7 percentage points lower than last year.

Published by the Danish Property Federation


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

Industrial

WEB REPORT

Vacancy rate decrease Following last quarter’s increase in vacancy for industry, the share of vacant leases has decreased again. Looking back at the beginning of the market statistic in January 2014, the positive trend means that industry is no longer the sector with the highest vacancy level. Since April 2016 the economic vacancy has decreased with 0.9 percentage points to 12.4 percent while the spatial vacancy has decreased with 1.1 percentage points, bringing the vacancy down to 12.5 percent. Contrary to the other sectors, industry has experienced a substantial decrease over the past year in both economical and spatial vacancy of 1.8 and 3.1 percentage points. Furthermore, the vacancy has decreased during the last three of four quarters. The economic vacancy for the Capital Region and the Southern Denmark Region decreases with 1.2 and 1.0 percentage points compared to April, bringing the respective vacancy rates down to 13.7 and 12.0 percent. The Zealand Region and the Mid Jutland Region both experience moderate increase in vacancy rate levels of 0.4 and 0.2 percentage points respectively. This quarter, the Zealand Region has the highest economic vacancy of 14.8 percent, which is 2.4 percentage points higher than the national average. On the other hand, the Zealand Region is also the region with the highest annual decrease within value and space.

Residential

Economic vacancy continues to decrease The economic vacancy for residential is decreasing for the second quarter in a row. The vacancy rate for the national average today lies at 2.8 percent, which is lowconsidering the natural vacancy coming from moving in and out and renovations. All regions experience a positive development in the economic vacancy. The Zealand Region and the Southern Denmark Region have the highest quarterly decreases of 0.6 percentage points, the Mid Jutland Region and the Northern Jutland Region have a decrease of 0.5 percentage points, while the Capital Region has the lowest decrease in the economic vacancy rate of 0.1 percentage point. The lowest vacancy rate at regional level is Southern Denmark, where the vacancy is at 1.6 percent. In this region, especially the Triangle Area experiences a high decrease in economic vacancy of 1.8 percentage points and an economic vacancy rate of 1.8 percent in July 2016. Odense has the lowest national economic vacancy rate of 1.1 percent, which is 0.6 percent lower than in April. The increase in the economic vacancy of 1.1 percentage points for Copenhagen CBD combined with a relatively high vacancy rate in this area is due to high activity within reconstructions, renovations etc. and thus not due to a decreasing demand.

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

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

WEB REPORT

Table 2. Office Economic vacancy rate April 2016 (percent) Capital Region Copenhagen CBD

Quarterly change (percentage points)

Spatial vacancy rate

Annual change (percentage points)

April 2016 (percent)

Quarterly change (percentage points)

Annual change (percentage points)

12.9

0.1

0.4

14.4

-0.2

0.4

7.9

0.3

-1.2

8.2

-0.1

-1.1

Other Copenhagen and area

13.8

0.0

0.7

15.3

-0.2

0.6

Northern Zealand

22.5

-0.6

3.5

22.6

-1.9

2.5

8.8

0.4

0.3

11.2

0.4

1.9

10.7

0.0

-2.0

13.9

-0.2

-2.7

Odense

13.6

-0.2

-

18.1

-0.7

-

Triangle Area

11.1

-

-

13.7

-

-

13.8

1.4

3.5

15.9

0.6

3.5

15.3

1.8

4.1

17.1

1.0

3.7

7.7

-0.3

0.5

11.4

-0.8

2.3

Northern Jutland Region

11.8

-0.7

4.8

13.6

-1.0

3.9

Total

12.7

0.1

0.6

14.4

-0.2

0.6

Zealand Region Southern Denmark Region

Mid Jutland Region Aarhus Other Mid Jutland

Source: The Danish Property Federation.

Table 3. Retail Economic vacancy rate

Spatial vacancy rate

April 2016 (percent)

Quarterly change (percentage points)

Annual change (percentage points)

April 2016 (percent)

Quarterly change (percentage points)

7.5

0.0

-0.3

6.9

0.4

-0.3

Copenhagen CBD

1.6

0.2

-0.2

1.7

0.4

-0.1

Other Copenhagen and area

9.0

-0.1

-0.5

7.8

0.6

-0.8

11.0

0.2

2.5

10.9

-0.7

2.8

Capital Region

Northern Zealand Zealand Region

Annual change (percentage points)

14.8

3.0

3.2

12.9

2.1

3.4

Eastern Zealand

14.0

2.9

3.5

11.2

1.4

2.3

Western- and Southern Zealand

16.6

3.3

2.4

15.4

2.9

4.9

8.6

-0.9

2.5

8.6

-1.2

2.1

8.3

-0.2

1.2

8.7

-0.2

0.2

7.1

0.3

-0.6

8.8

0.5

-1.0

4.3

-1.1

-1.7

4.0

-0.5

-2.0

12.6

2.9

1.4

15.4

1.9

0.7

13.2

0.9

0.1

9.5

0.1

-2.1

8.6

0.3

0.2

8.2

0.4

0.2

Southern Denmark Region Triangle Area Mid Jutland Region Aarhus Other Mid Jutland Northern Jutland Region Total Source: The Danish Property Federation.

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

WEB REPORT

Table 4. Industrial Economic vacancy rate

Spatial vacancy rate

April 2016 (percent)

Quarterly change (percentage points)

Annual change (percentage points)

April 2016 (percent)

Quarterly change (percentage points)

Annual change (percentage points)

13.7

-1.2

-1.3

13.5

-1.3

-2.8

Copenhagen CBD

13.3

-0.1

1.4

24.2

-1.1

0.7

Other Copenhagen and area

13.8

-1.4

-1.7

12.6

-1.5

-3.3

Northern Zealand

12.8

-0.5

0.4

13.4

-0.4

0.3

Capital Region

Zealand Region

14.8

0.4

-1.8

11.1

0.6

-6.3

Southern Denmark

12.0

-1.0

0.6

16.4

-2.5

-0.8

Mid Jutland Region

5.9

0.1

-1.4

7.0

0.0

-2.0

7.3

-0.3

-6.2

8.1

-0.5

-10.1

12.4

-0.9

-1.8

12.5

-1.1

-3.1

Aarhus Total Source: The Danish Property Federation.

Tabel 5. Residential Economic vacancy rate

Spatial vacancy rate

April 2016 (percent)

Quarterly change (percentage points)

Annual change (percentage points)

April 2016 (percent)

Quarterly change (percentage points)

Annual change (percentage points)

2.9

-0.1

0.7

2.7

-0.1

0.4

Copenhagen CBD

4.5

1.1

-1.6

4.0

0.9

-1.3

Other Copenhagen and area

2.5

-0.2

0.7

2.3

-0.2

0.3

Northern Zealand

3.7

-0.3

2.7

3.5

-0.2

2.4

Capital Region

Zealand Region

3.4

-0.6

1.8

4.3

-0.6

2.1

Eastern Zealand

2.0

-0.6

1.2

2.0

-0.5

1.1

Western- and Southern Zealand

3.9

-0.8

1.7

4.9

-0.9

1.9

Southern Denmark

1.6

-0.6

-0.9

1.6

-0.4

-0.7

Odense

1.1

-0.6

-0.1

1.2

-0.5

0.1

Triangle Area

1.8

-1.8

-0.6

1.4

-1.7

-0.6

Other Southern Denmark

2.1

0.4

-1.3

2.0

0.6

-1.0

3.3

-0.5

-3.1

2.9

-0.4

-2.6

Aarhus

3.2

-0.4

-3.0

2.6

-0.2

-2.1

Other Mid Jutland

3.8

-1.3

-3.8

3.8

-1.3

-4.1

Mid Jutland Region

Northern Jutland Region

2.2

-0.5

0.5

2.6

-0.6

0.6

Aalborg

1.9

-0.5

0.9

2.0

-0.6

1.1

Other Northern Jutland

5.1

-0.1

-2.4

7.6

-0.2

-1.7

2.8

-0.3

0.1

2.6

-0.2

0.1

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 July 2016

WEB REPORT

About the Market Statistics This web report is published 1 September 2016. Next planned publishing is mid-November 2016. This report is based on data from: 2 + 3 Ejendomme, Aberdeen Asset Management, Alm. Brand, Andersen Partners Ejendomsadministration, AP Pension, Arkitekternes Pensionskasse, ATP, Bevica Fonden, Blue Vision, Carlsbergfondet, CEJ Ejendomsadministration, Coller Capital, CS Pensionsfond, CW Obel Ejendomme, DADES, Danica, Dansk Sygeplejeråd, Danske Bank, DATEA, Focus Asset Management, DEAS, DEAS Invest 1, DIP, DNP, Ejendomsselskaberne Grønløkkevej 10, Fast Ejendom Danmark, FrederiksbergFonden, Færchfonden, Grosserer Schiellerup og Hustrus Fonde, Gudbjørg og Ejnar Honorés Fond, HD Ejendomme, Højgaard Ejendomme, Industriens Pension, Jammerbugt Kommune, Jeudan, Jorcks Ejendomsselskab, JØP, Kalkværksgrundene, Kalvebod Ejendomme, KIRKBI, Kramers Legat, LB Forsikring, Lægernes Pensionskasse, Lærernes Pension, MP Pension, Niam, Nordea Ejendomme, Nordea Liv og Pension, North Property Asset Management, NREP, PBU, PenSam, PensionDanmark, Pensionskassen for Farmakonomer, PFA, Pitzner Ejendomme, PKA, Realdania, Sampension, SEB, SPG Omsorg DK1, Steen & Strøm, Taurus Ejendomsadministration, TDC Pensionskasse, Topdanmark, Tryg, Valad og Aage Larsens Boligudlejning. The portfolios have approx. 70.000 rentals corresponding to an annual lease value of DKK 16.9 bn and 14.4 m m2. In order to compare, the statistical base in July 2015 was a lease value of DKK 14.8 bn and 12.6 m m2. 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 as per 30 June 2016 and is called July 2016. The quarterly change is from July 2016 (closed as per 30 June 2016) compared to April 2016 (closed as per 31 March 2016). The annual change is from July 2016 (closed as per 30 June 2016) compared to July 2015 (closed as per 30 June 2015). The data published are updated and valid on the publication date. As the Market Statistics are updated ongoing, e.g. with new historic data, historic data can change from one period to the next. We have chosen not to publish data, where the data is not sufficient to give a valid and representative result or in combinations where only one or 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.

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Profile for EjendomDanmark

EjendomDanmark marked statistics - Vacancy (July 2016)  

- Decrease in economic vacancy - Office vacancy still above average - Higher vacancy for retail - Another decrease in vacancy for residentia...

EjendomDanmark marked statistics - Vacancy (July 2016)  

- Decrease in economic vacancy - Office vacancy still above average - Higher vacancy for retail - Another decrease in vacancy for residentia...

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