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Germany Real Estate Report Q3 2011

Germany Real Estate Report Q3 2011

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Additional Information

Price	$530.00
Publisher	Business Monitor International
Date of Report	Jun 17, 2011

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Quick Overview

Recent developments confirm that the generally benign environment foreseen by BMI’s in-country sources in late December 2010 remains intact. A strong rebound in investment, a surge in business for Germany’s exporters and improving consumer confidence are all good news.
This comes after a more challenging environment in 2009-2010, when the various protagonists in Germany’s commercial real estate sector managed to keep markets in equilibrium across sub-sectors and in each of the cities – Munich, Dusseldorf, Berlin and Frankfurt – for which we gathered data. Although there was vacant space, the amounts were neither excessive nor increasing. Yields are also neither excessive nor increasing. Interestingly, there has been a clear upturn in lending by Germany’s Pfandbrief banks, which are an important source of funding, and not just for the commercial Real Estate sector.
Our in-country sources have – fairly, in our view – been cautiously optimistic about 2012. They are looking for no change in office rents in Berlin and Frankfurt; however, rents are expected to rise by 2-3% in Munich and by a little more in Dusseldorf. For retail rents, there should be small increases of 2-3% in Dusseldorf and Frankfurt, with slightly higher rises (perhaps 6% or so) in Munich and Berlin. Our sources have envisaged that industrial rents will remain essentially flat in 2012 – although they may grow by 5% or so in Berlin.

Table of Contents

Executive Summary ........................................................................................................................................ 5
SWOT Analysis ................................................................................................................................................ 6
Germany Real Estate/ Construction Industry SWOT ............................................................................................................................................ 6
Germany Economic SWOT ................................................................................................................................................................................... 6
Germany Business Environment SWOT ................................................................................................................................................................ 7
Real Estate Market Overview .......................................................................................................................... 8
Table: Historic Rents – 2009 And 2010 (m2/month, EUR) .................................................................................................................................... 9
Table: Net Yields, 2010 And 2011 (%) ................................................................................................................................................................ 10
Table: Terms Of Rental Contract/Lease, Mid-2010 ............................................................................................................................................ 10
Table: Available And Vacant Space, Mid-2010 (m2) ........................................................................................................................................... 11
Forecast Scenario ......................................................................................................................................... 12
Real Estate Outlook ............................................................................................................................................................................................ 12
Table: Real Estate Markets – Rentals, 2010-2012 (m²/month, EUR) ................................................................................................................... 13
Table: Forecast Yield, 2008-2015 (%) ................................................................................................................................................................ 14
Construction Industry Outlook ............................................................................................................................................................................ 15
Table: Germany Construction And Infrastructure Industry Data ........................................................................................................................ 15
Table: Germany Construction And Infrastructure Industry Data ........................................................................................................................ 16
Macroeconomic Outlook ..................................................................................................................................................................................... 20
Table: Germany – Economic Activity, 2008-2015 .............................................................................................................................................. 22
Business Environment ................................................................................................................................. 23
Real Estate/Construction Business Environment Rating ..................................................................................................................................... 23
Table: Europe Real Estate/Construction Business Environment Rating .............................................................................................................. 23
Germany’s RECBER ........................................................................................................................................................................................... 24
Business Environment ......................................................................................................................................................................................... 25
Table: BMI Business And Operation Risk Ratings .............................................................................................................................................. 25
Table: BMI Legal Framework Rating ................................................................................................................................................................. 27
Table: Labour Force Quality .............................................................................................................................................................................. 30
Table: Trade And Investment Ratings ................................................................................................................................................................. 31
Table: Top Exports ............................................................................................................................................................................................. 32
Competitive Landscape ................................................................................................................................ 34
Company Monitor .......................................................................................................................................... 36
Hochtief .............................................................................................................................................................................................................. 36
Multi Development Germany GmbH ................................................................................................................................................................... 38
ORCO Property Group Germany ....................................................................................................................................................................... 40
Patrizia Immobilien AG ...................................................................................................................................................................................... 42
TAG Immobilien AG ........................................................................................................................................................................................... 44
Vivacon AG ......................................................................................................................................................................................................... 46
BMI Methodology .......................................................................................................................................... 48
How We Generate Our Industry Forecasts ......................................................................................................................................................... 48
Construction Industry ......................................................................................................................................................................................... 49
Bank Lending ...................................................................................................................................................................................................... 50
Real Estate/Construction Business Environment Rating ..................................................................................................................................... 50
Table: Weighting Of Indicators .......................................................................................................................................................................... 51
Project Finance Ratings Indicators .................................................................................................................................................................... 53
Table: Design And Construction Phase .............................................................................................................................................................. 53
Table: Commissioning And Operating Phase – Commercial Construction ......................................................................................................... 54
Table: Commissioning And Operating Phase – Energy And Utilities .................................................................................................................. 55
Table: Commissioning And Operating Phase – Transport .................................................................................................................................. 56