Polish market
RICS report presents that spirits concerning lease market have not changed in Poland in the last quarter of 2014 in comparison to previous periods and they still remain negative, the best evident of which is the uninhabited flat rate maintaining on a high level. In spite of this fact, the spirits are improving in some investors, although the majority of respondents are concerned with predictions concerning changes of the amount of rent for office properties in the best locations as well as the secondary ones. The prognosis for weaker office properties is also comparatively negative.
The market remained neutral on improvement of consumers' spirits caused by a constant improving situation on the labor market. The faster pace of growth in supply over demand translates itself into increase in expectations concerning lowering the amount of rent. However, the interest in investments as well as improving conditions of granting loans favor expectations of small increase in prices of prime properties, which may be interpreted as awaited and minor compression of capitalization rates at decreasing amounts of rent. Moreover, we may expect some pressure concerning decreasing the value of properties on secondary markets, which may result from lower amounts of rent forecasted by respondents. According to them, the capitalization rate of office properties of a prime type totals 6,1 per cent.
The year 2014 was a good period on the Polish market of investment transactions in the commercial property sector. The total value of concluded transactions reached over 3 billion euro, similarly to 2013. The high activity of investors reflects a positive perception concerning foundations of Polish economy, confirmed by good economic performances for 2014 against Europe. Five of the greatest office personal selling in 2014 (Rondo 1, Lipowy Office Park, Metropolian, Quattro Business Park and portfolio of Ghelamco buildings) resulted in the amount of 902 million euro, constituting 51 per cent of the value of transactions in this sector. After overtaking the best office structures at high rates of uninhabited flats and negative perception of secondary markets (concerning both perspectives of decrease in rent and value of a property), the interest of investors in the office sector should be now concentrated on downtown central investments – comments Łukasz Maciejak in MRICS Chartered Valuation Surveyor, Director in Capital Market Team in DTZ Poland.
Poland against Europe
The results of growth performance are not uniform for Europe. According to spirits rates, commercial properties in Spain, Portugal, Germany and Great Britain should reach a substantial capital value and increase in rent in the nearest year. The greatest demand among investors in last quarter of 2014 was observed in Spain and Portugal – countries which are affected by a financial crises from 2008.
The lease markets in France and Italy are not in the best situation. They are characterized by a low demand among tenants, which is weakening together with increasing supply of free and building area. The unemployment increased in both countries last year, which somehow explains such negative spirits on those markets – a further decrease in short-term rent is expected there. On investment markets, in turn, early signs of improvement may be observed – the interest in investments is increasing mainly in France but also in Italy in more moderate pace.
In global terms
The situation in chosen parts of the world is also improving, in spite of the fact that certain local considerations are very diverse. According to RICS report, the sector of commercial properties in Japan is working its way up to the top, in spite of recession. However, it still stays behind the United States, in which the development pace is the highest. Moreover, the spirits in Brazil and Russia are worsening, where the property market is experiencing some effects of a strong economic pressure. The perspectives of growth for India, in turn, are optimistic.
RICS Global Commercial Property Monitor is a quarterly published guidebook presenting trends on the commercial property market in the investment and lease segment. It is published on the basis of answers of RICS members within a polling conducted among them which concerned comparison of conditions from the last 3 months with the last quarter. The questionnaires of an actual survey were sent on16th September 2014 and the answers were collected till 10th October 2014. There were jointly 1002 answers concerning three sectors: offices, shopping malls and warehouse areas.
The Royal Institution of Chartered Surveyors (RICS) is an international organization gathering professionals closely related to property and construction industry. The institution promotes development of professional qualifications, maintaining the highest standards and rigorous adherence to ethical code. The membership in RICS is considered as guarantee of professionalism in the property and construction industry. RICS gathers nearly 100 000 specialists all over the world, who keep vigilance at improvement and adherence to standards on local markets.
RICS was founded in 1868 as an independent and international occupational organization in Great Britain. Currently, it functions on the basis of a division on following departments: Great Britain (continental), MENEA (Near and Middle East as well as Africa), Americas, Asia, Oceania and India.
RICS Poland was founded in 1991. At present, the organization gathers over 250 members among leading companies and organizations functioning on a widely understood property market in Poland.