Investment Market Germany PROVADA 5 th June 2013
In Europe, which country/region do you believe to be the most attractive for making investment purchases in 2013? 40 35 2012 2013 2012 (n=341) 2013 (n=361) 30 25 % 20 15 10 5 0 Germany UK CEE Spain France Nordics Holland Italy Other Source: CBRE European Investor Intentions Survey 2013 CBRE Page 2
Which city is most attractive for purchases in 2013? London Munich Berlin Paris Warsaw Dublin Hamburg Frankfurt Madrid Amsterdam Brussels Stockholm Moscow Barcelona Milan 0.0 5.0 10.0 15.0 20.0 25.0 30.0 35.0 Percentage Source: CBRE European Investor Intentions Survey 2013 CBRE Page 3
1 Economic Background
GDP real: Germany vs. Eurozone Germany The Powerhouse in a struggling Eurozone 4% 3% 2% 1% 0% -1% -2% -3% Euro zone Germany France Italy Spain U.K. U.S. 2011 2012 2013F 2014F 2015F 2016F Source: Consensus Economics, Destatis (Feb 2013) CBRE Page 5
Unemployment rate in comparison German Unemployment Rate down to 5%! Source: Eurostat (Dec 2012) CBRE Page 6
2 Office Letting Market
5% 4% 3% 2% 1% 0% -1% -2% -3% -4% -5% CBRE Page 8 Prime Office Rental Growth, 2012-14 Madrid Barcelaona Lisbon Dublin Milan Rome Brussels Budapest Prague Amsterdam Zurich Pais CBD Warsaw Copenhagen Frankfurt Hamburg Vienna Berlin Stockholm Helsinki Munich Moscow London City London WE Oslo annualised, 2012-14 Source: IPF (Nov. 2012) Best growth predicted for London and some German and Nordic cities
Top 5 Office Markets Germany Prime Office Rents Frankfurt Munich Dusseldorf Hamburg Berlin Source: CBRE Research CBRE Page 9
Top 5 Office Markets Germany Take-up (incl. Owner-Occupier) by Office Market/Vacancy Rate 3,500 12% 3,000 10% 1,000 sq m 2,500 2,000 1,500 1,000 8% 6% 4% 500 2% 0 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 Q1 0% Berlin Dusseldorf Frankfurt Hamburg Munich Avg. Vacancy rate Top 5 Source: CBRE Research CBRE Page 10
3 Property Investment Market
Investment Market Germany EUR 25.2bn Transaction Volume in 2012 plus 11% y-o-y +++ after 2006/2007 best year ever and highly promising start to 2013 Source: CBRE Research CBRE Page 12
Investment Market Germany Volume of Transactions by Type of Use 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% 2007 2008 2009 2010 2011 2012 Office Retail Logistics/Industrial Development Sites Others Source: CBRE Research CBRE Page 13
Retail Investment Market Germany Lack of core products and absence of large deals hinder higher transactions volume. Anyway, y-o-y plus 42% in Q1 2013. 9.2bn +42% Source: CBRE Research CBRE Page 14
Investment Market Germany Prime Office Yields Net Initial Yields*: 5.00 % Berlin 5.00 % Dusseldorf 4.90 % Frankfurt 4.88 % Top 5 Total 4.75 % Hamburg 4.75 % Munich Multiplier (gross): 17.85 Berlin 17.85 Dusseldorf 18.20 Frankfurt 18.30 Top 5 Total 18.75 Hamburg 18.75 Munich Source: CBRE Research * Based on usual non-recoverable costs in the market CBRE Page 15
Yield Premium at a Historic High German Prime Office Yield versus 10-year bond Source: CBRE Research CBRE Page 16
4 Top 5 Cities Market Information
Top 5 Office Markets Germany Stock 13.53 mill. sq m Prime rent 24 /sq m/month 290 p.a. Prime yield 4.75 % Take-up 107,000 sq m Vacancy rate 7.6 % Office employees 490,680 Stock 9.36 mill. sq m Prime rent 26 /sq m/month 310 p.a. Prime yield 5.00 % Take-up 76,800 sq m Vacancy rate 11.1 % Office employees 238,475 Dusseldorf Office Take up Q1 2013 = 0.5 M sq m* Hamburg Berlin Stock 17.85 mill. sq m Prime rent 22.50 /sq m/month 270 p.a. Prime yield 5.00 % Take-up 85,500 sq m Vacancy rate 8.5 % Office employees 668,212 Stock 11.71 mill. sq m Prime rent 38 /sq m/month 450 p.a. Prime yield 4.90 % Take-up 71,100 sq m Vacancy rate 14.2 % Office employees 322,841 Source: CBRE Research CBRE Page 18 Frankfurt * Top 5 cities, 2013 Q1 Munich Stock 21.00 mill. sq m Prime rent 31.50 /sq m/month 380 p.a. Prime yield 4.75 % Take-up 155,900 sq m Vacancy rate 7.0 % Office employees 474,646
Contact: International Investment Matthias Euler Senior Director Co-Head International Investment CBRE GmbH WestendDuo Bockenheimer Landstraße 24 60323 Frankfurt T +49 69 170077 629 M +49 151 15150570 matthias.euler@cbre.com DISCLAIMER 2013 CBRE Information herein has been obtained from sources believed reliable. While we do not doubt its accuracy, we have not verified it and make no guarantee, warranty or representation about it. It is your responsibility to independently confirm its accuracy and completeness. Any projections, opinions, assumptions or estimates used are for example only and do not represent the current or future performance of the market. This information is designed exclusively for use by CBRE clients, and cannot be reproduced without prior written permission of CBRE. CBRE Page 19