Investment market
Prime yields on office properties in European comparison (in %)
Source: EHL Market Research | BNP Paribas Real Estate | Q2 2022
Investment market The real estate investment market in Austria once again recorded a high transaction volume in the first quarter of 2022 and was also marked by a high level of demand among both private and institutio- nal investors. Despite the pandemic, which is still not over, and the escalation of the Ukraine crisis in February in Ukraine, investor interest in Austrian real estate shows no signs of letting up.
again from Austria and Germany, as many potential buyers from the Far East and Anglo-Saxon coun- tries, for example, chose not to travel in light of the restrictions that remained in effect during the cold months of the new year. However, we can expect that as the weather gets warmer, travel restrictions and other restrictions will be eased, leading to a moderate increase in the number of buyers from outside of Europe. Along with the high demand in the top segment in each asset category, it has become noticeable that institutional portfolio owners are now more interes- ted in portfolio streamlining, among other reasons due to the EU taxonomy and the ESG guidelines. Over the medium term, this will lead to a situation in the office segment especially in which properties that cannot meet the more stringent EU require- ments will be put on the market and sold to asset managers whose business models involve optimi- sing energy efficiency and improving sustainability in purchased properties (“manage to ESG”). Yields, which have been continuously declining as of late, will begin moving more or less sideways over the next few months, while prices in the top segment in each asset category will increase at a lower rate than has been the case over the last few months.
Transaction volume over the first three months of 2022 amounted to approximately EUR 900 million. It should be noted here, however, that a large num- ber of the transaction processes initiated at the be- ginning of the year are still being implemented, and the associated volume will therefore not appear in the statistics until after the second quarter. Investors focused in the first quarter on office pro- perties. These accounted for some 54% of all inves- tment and were followed by institutional residential projects (30%) and mixed residential-commercial buildings (11%). Only a few transactions were recor- ded in the retail and hotel segments during the first quarter of 2022. Each of these asset categories accounted for approximately 2% of all transactions. Several transactions are currently in the pipeline here, however, which is why investment volume in these segments as well should rise again as the year proceeds. Due to the ongoing pandemic, most investors in the first quarter were once
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