A new article from the Wall Street Journal titled "Heavy Weather: The European property market is finally emerging from its recessionary deep-freeze, but there are still plenty of icy patches for investors to slip on" takes stock of the current commercial market conditions in Europe. The article notes that prices in the U.K. fell 44.2% between July 2007 and July 2009, according to Investment Property Databank. And according to CB Richard Ellis Group, investment volumes in Europe as a whole fell from the record high of €256 billion ($350 billion) in 2007 to €73 billion in 2009.
"Two years ago we were looking down the edge of a cliff," said Robert Noel, managing director of the London portfolio at Land Securities. "We are now buying into a recovery and there is not enough office supply to meet the demand."
"The market had been picking up, partly thanks to banks lending again," said Eric Sasson, who heads up the European operations at The Carlyle Group, the private equity firm. "But the Greece crisis put a hold to that. Having just got out of the freezing zone, banks went cold again – and some deals got delayed."
"There was a massive globalized real estate market in 2007," says Pierre Vaquier, chief executive of AXA Real Estate Investment Managers. "But then afterwards there was a 'flight to home' – as people wanted to go where they understand best."
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