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Sam Boal/Photocall Ireland
commercial property
Property investors still love us - but there could be competition from Spain
The Irish property feeding frenzy is still the most active in Europe, but Spain is heating up.
THE UK AND Ireland are still leading the way in the Commercial Real Estate market, but could face strong competition from other European countries in coming months.
That’s the verdict of international property consultancy Cushman Wakefield, which is predicting a flood of Spanish assets coming onto the market to take advantage of record levels of interest from international investors.
Intense interest in Irish commercial property and loans has been a feature of the Irish market in the last 18-24 months, and has allowed Nama to accelerate its sales process.
A new report from international property consultancy Cushman Wakefield found that €40.9 billion worth of CRE deals done this year, 30% more than the total for the entire year last year, and 611% more than the first six months of 2013.
Cushman Wakefield have estimated a total figure of around €584 billion in exposure to non-core real estate for banks around Europe – the property consultants are betting that some or all of this property could be offered up to funds over the coming years.
While the UK and Ireland accounted for 63% of all deals completed during the first half of the year, Cushman Wakefield said that the Spanish market is ‘ballooning’ and is “guaranteed a record year.”
This is largely due to sales anticipated to come from Spain’s version of Nama, Sareb, which has around €102 billion worth of real estate to get rid of.
Not to be outdone, the report notes that UK and Irish banks still have a combined exposure of €244 billion to property “and therefore will continue to be key players in the market”.
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