A research produced by
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With recent political uncertainty and the prolonged unwind of the GFC, focus remains on downside risks.
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Our outlook shows robust economic fundamentals are driving occupier and investment markets in a positive direction over the next 2-5 years, with little risk on new supply, rising interest rates and leverage.
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Occupier markets are showing better market rental growth as new supply remains modest and net absorption steps up with improving consumer spending and employment growth. E-commerce is a key driver for both the bifurcation in the retail markets and the new record take-up across logistics.
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With the recovery in capital values and tightening of yields across the most liquid core investment markets, investors should consider adjusting their focus for the medium term to:
- Consider a broader range of European markets, as implied by our market scoring;
- Focus on income returns, as marginal yield widening and limited upside in capital value is projected;
- Given the low systematic market risks at the moment, expand into value creation assets.
Source : AEW Europe
