Commercial property investment value in Europe at 10 year high

The pricing of European commercial property has achieved the most profitable investment outlook for almost a decade, according to this morning’s report from integrated corporate real estate firm DTZ.

The Fair Value Index – a pioneering commercial property value index focusing on future trends – takes into account the performance of market prices across the continent, utilising the value of the country’s major property transactions to issue them with a grade out of 100.

This morning’s report revealed that the total index score for Europe performed strongly in the closing quarter of 2012, rising to 78 from 62 in Q3, indicating that today’s market provides the best value for commercial property since September 2003.

Magali Marton, DTZ’s head of research for central Europe, Middle East and Africa, said: “The most significant factor behind this change has been the more positive outlook for the Eurozone which has pushed down bond yields and required returns as the risk of break up has receded. The upshot is that property looks better value in comparison to bonds”.

The top performers highlighted in the findings of the report were Belgium and the Netherlands, who both ranked a perfect score of 100. The UK and Irish markets rose by three points on 2012 to 91, maintaining a modest position of seventh in the Europe-wide rankings.