Damian Harrington, Director, Head of EMEA Research, Colliers International
Offices and retail are still taking up most of the investment but in Europe the real momentum is behind residential, industrial, hotels and development, Damian Harrington, Director, Head of EMEA Research, Colliers International, told Real Estate Day.
‘In terms of the trends that we are seeing, when we look at investment flows there is a lot more activity moving into residential in particular, globally and in Europe, and a lot more investment going into the industrial sector,’ he said. ‘But we’re also seeing retail coming back’.
Colliers has done an analysis of major global investors who are diversifying globally from a range of domiciles and looking at where their holdings were in 2010 relative to where they are now. The research shows that ‘offices and retail still take up the lion’s share but the momentum is behind other sectors,’ Harrington said. ‘We see a lot of money going into residential, a lot into industrial, quite a lot into hotels but a huge amount into development’.
At the moment there are many opportunities emerging in different European cities. ‘They are emerging at different paces and a lot depends on the infrastructure, which is really changing how cities work’, he said. ‘Regeneration is really being driven by infrastructure’.
One example of this is Paris, which, according to Harrington ‘is going to be a very interesting play over the next 10-15 years’ with the Grand Paris project and the upgrade and expansion of the metro system.
‘Big occupiers have already started to move out to the inner suburbs and it’s spreading the city around and changing the amount of investment opportunities that are available’, he said.
Mixed-use is all the rage at the moment, but ‘it is important to get the mix right’, Harrington said. ‘Residential and retail is an obvious combination but there is growing demand for logistics as well. Within a city you can’t just do logistics on its own because the rental value will not drive growth development value to match, so you have to blend it with other uses’.
The same thing applies to retail, which is now all about omni-channel and how logistics and retail can work together. ‘But retail works really well with residential and offices because they drive the demand for the retail,’ he said. ‘It’s all about getting it right and taking into account public transport which is a crucial factor. But, even though we are going through a cyclical cooling of the market, there are going to be a lot of opportunities across many different cities in Europe’.
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