Emerging Trends in Real Estate® Europe 2012

The economic crisis has left the European real estate industry in limbo, with preferred markets chosen more on their potential as safe havens than high-growth hubs, and with highly specialised non-core investments gaining attention as alternatives to traditional property types. Prospects for any turnaround this year hinge on how recent regulatory measures will affect banks’ willingness to make commercial loans, and whether another financial industry collapse caused by sovereign debt issues ultimately triggers a widespread release of assets by banks to investors.

2012 marks the beginning of an era that will be defined by more negatives than positives in its early years. Our report predicts that this year, property financing will become a major casualty of the measures banks take to tackle regulatory and macro-economic pressures; deleveraging will not free up capital for fresh property lending; debt will become more short-term and expensive; and the need to find alternative sources of funding will become imperative.