Research Briefing | Jun 11, 2024

European CRE virtual roundtable – Top questions we received

In our recent virtual roundtable event for commercial real estate, we discussed our expectation for eurozone interest rate cuts in H2, starting this month, despite the recent uptick in inflation and negotiated wage data.

What you will learn:

  • Our sentiment data nowcast models suggest wage growth is moderating and labour market gains are slowing, which should allow the ECB to carry on cutting rates beyond June.
  • We continue to believe that CRE values will end this year in a much better position than last year, although capital growth is expected to be near zero in both the UK and eurozone.
  • The industrial, residential, and hotel sectors look set to lead the recovery in values, particularly in the eurozone, while retail looks well positioned in the UK.
  • We also highlighted the CRE opportunities that are emerging this year and next in Europe, as signalled by our Relative Returns Index, particularly in the industrial and retail sectors. The industrial sector remains our top pick as the first sector to recover, particularly in core eurozone markets and the Nordics.
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