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News Release

London, Moscow

2011 European Retail Real Estate Investment Volume is up 35%

Preliminary figures indicate total transaction volumes will exceed €28bn


London, Moscow, 19th January 2012 - Jones Lang LaSalle reports retail real estate investment remained strong in the final quarter of 2011. Preliminary analysis suggests that direct investment in retail real estate for the year is likely to exceed €28bn, which Jones Lang LaSalle forecast earlier in the year, representing a significant increase on 2009 and 2010 total volumes of €12.3bn and €20.7bn respectively.

Geographically, the majority of activity remains focused on the UK and Germany. The UK leads the rankings, despite a strong second half of the year for Germany. Capital Shopping Centres’ purchase of the Trafford Centre in Manchester for over €1.8 billion in the first quarter, was the major purchase in the UK market in 2011, whilst the purchase in the fourth quarter of Perlacher Einkaufs Passagen (known as PEP shopping centre) in Munich by TIAA-CREF (the US teachers’ pension fund) from RREEF for over €400m, boosted the total volume in Germany.

France and Sweden enjoyed strong final quarters. In France, La Française AM, an investment fund majority-owned by Crédit Mutuel Nord, purchased a portfolio of Carrefour properties for €365m. In Sweden, the fourth quarter saw the purchase of a portfolio of three shopping centres in Stockholm, by AMF Fastigheter, the property subsidiary of Swedish pension fund AMF. The Stockholm portfolio was bought from Centeni, a company owned by the Royal Bank of Scotland.

Investors’ activity on Russian retail property market also remained at a very high level.

According to preliminary data of Jones Lang LaSalle, 2011 transaction volume for Russian retail property will amount to $3.3bn (€2.45bn). For the first time in 5 years the share of investment in this sector reached 40%, equalizing with the investment volume in office property within total transaction volume.

Olesya Cherdantseva, Head of Retail and Capital Markets Research, Jones Lang LaSalle, Russia and CIS, stated: “The Russian market continues to offer many opportunities for investors despite the uncertainty that is widely considered to be connected with the forthcoming presidential election and pending global market slowdown. Positive sentiments were confirmed by an increase in retail property investment in 2011 (more than seven times the volume of 2010). Deals with income producing assets accounted for a overwhelming portion of total transaction volumes (about 90%). Moreover, a significant rise in interest from foreign investors, in Russian projects, was demonstrated last year: Transactions with foreign capital reached 42% of total transaction volumes, compared to 2009-2010 when their share amounted to about 10%. At the same time, transaction size has also increased with acquisitions above $100m accounting for 87% of total volumes, compared to 30-50% in previous years.”

Jeremy Eddy, Head of European Retail Capital Markets, commented, “2011 saw the development of a multispeed Europe, with national economic performance and stability dictating investment flows and pricing. Around 75% of the total transaction volume was completed in just five countries. This polarisation was not only limited to geography, as 2011 saw an absolute focus on prime property.
We expect a similar trend in 2012, however we also identify and urge a greater focus on micro locations, and particularly the sustainability and affordability of rents irrespective of geography. This approach will assist investors to identify opportunities outside of the core markets, which will remain the narrow focus of the majority, and ultimately unlock greater returns in the long term.”

Notes to editors
Jones Lang LaSalle will publish a more detailed analysis of 2011 investment volumes outturn towards the end of January, along with additional forecasts and predictions for what will happen in 2012.
This research considers all investment sales of shopping centres, retail warehouses and factory outlet centres in Europe. It excludes the high street and any investment deal less than US$5 million in value.


About Jones Lang LaSalle
Jones Lang LaSalle (NYSE:JLL) is a financial and professional services firm specializing in real estate. The firm offers integrated services delivered by expert teams worldwide to clients seeking increased value by owning, occupying or investing in real estate. With 2010 global revenue of $2.9 billion, Jones Lang LaSalle serves clients in 70 countries from 1,000 locations worldwide, including 200 corporate offices. The firm is an industry leader in property and corporate facility management services, with a portfolio of approximately 167 million square meters worldwide. LaSalle Investment Management, the company’s investment management business, is one of the world’s largest and most diverse in real estate with $47.9 billion of assets under management.
In Russia and CIS Jones Lang LaSalle have offices in Moscow, St. Petersburg, Kiev and Almaty. Jones Lang LaSalle, Russia was voted Consultant of the Year in 2004, 2006, 2007, 2008, 2009, 2010 and 2011 at the Commercial Real Estate Awards, Moscow and Consultant of the Year at the Commercial Real Estate Awards 2009, St. Petersburg. For further information, please visit our website www.joneslanglasalle.ru