Research
Summer/Autumn 2012
European INVESTMENT Commentary
Highlights • The European economic downturn has deepened, with the sovereign debt crisis weighing on confidence and fiscal austerity measures dragging on growth, particularly in heavily indebted countries such as Italy and Spain. Eurozone GDP is forecast to contract by around 0.4% in 2012 and prospects for growth in 2013 have weakened. • Occupier market activity has eased moderately, with European office take-up falling by 4% in H1 2012 compared with the same period of 2011. Prime rental growth has stalled in most European markets, and rents have come under downward pressure in some weak southern European markets. • European commercial property investment volumes fell by around 20% in H1 2012 on a year-on-year basis. Equity-backed investors with a focus on low-risk prime assets have remained active, particularly in London and Paris.