According to some analysts, investors are oriented to markets who are making an economic comeback, to regional capitals and secondary class properties, along the lines of the competition being more fierce for class A European estate assets.
Investors see acquisition opportunities in Ireland and Spain. Due to the fierce competition mentioned above, investors are determined in their search to look for attractive assets and to look into the markets that are just getting on their feet, like Ireland and Spain, says the ‘Emerging Trends in Real Estate Europa 2014’ report.
Most people think that this year, the attractive asset shortfall is going to have a moderate or significant impact on their business. Since the new real estate environment is even more competitive than in the last years, 59% of the people asked said that most probably, the class A type of proprieties from the main European real estate markets are now being overvalued. It seems though, that investors are becoming more and more comfortable with assuming certain risks, in their search for bigger profits.
One of the cities that is benefiting from this trend is Dublin. It has spectacularly climbed in the top investment destinations, from the 20 spot in 2013, to the second in 2014. The real estate market in Dublin is now one of the most attractive ones in Europe, compared to last years when no one wanted to buy properties there. Not only Irish investors are buying, but also foreigners are being attracted by the low prices and improved economic perspectives.
Even though Spain continues to struggle with its economic crisis and a still high unemployment rate, the increased capital at an international level, looking for profitable placements determines investors to look at real estate markets like the one in Spain.
Many believe that the opportunities are very good this year, a fact stated by the acquisition of the commercial complex Parque Principado from Oviedo by the Intu and Canadian Pension Plan Investment Board for 162 million euros. Some sceptics still say that financing is still hard to get and that market will be risky for a while more.
Class A assets
The competition for class A assets has led to a rise in the number of investors that are also looking at other asset categories on the big European markets like London, Munich and Paris and are buying assets from smaller cities that are bringing them solid revenues. Investors from the office real estate market in Munich obtain revenues of approximately 4%, but those willing to invest in smaller German cities like Stuttgart can have revenues of 6,5%.
Investors also look for secondary class properties in big cities that already have good revenue flows or that have a concise handling of assets that can later become class A properties.
There are many who think that the resources from Asia – Pacific and the Americas will continue growing this year. Last year, Chinese investors took the real estate market by storm all over the world, so this year we are curious who will appear as the leader in this business.
Author Bio: Mark Moz, well known for his professionalism and dedication as a real estate consultant to clients. His goal is to help the people he works with achieve their own objectives of purchasing and selling real estate. Both and buyers and sellers benefit from Mark’s area knowledge, marketing search, and his due diligence. In his spare time, he writes informative articles for various websites e.g-http://www.pallspera.com/.