Skip Ribbon Commands
Skip to main content

News

LONDON

Global property market edges towards recovery

Jones Lang LaSalle releases global property update for Q3 2012


LONDON, 6 August 2012 – Jones Lang LaSalle has released its quarterly Global Market Perspective, which captures in-depth data and analysis on the global property market in the year to date.

Following a lull in activity during Q1, the global property market has resumed a steady recovery path. Investment volumes recovered to US$108 billion in Q2, 24% up q-o-q, signaling that capital markets are on track to achieving US$400 billion volumes for full-year 2012.

Other key highlights on the quarter include:

  • The global economic outlook has weakened as euro strains re-emerges.  Asia Pacific markets will continue to drive global growth this year, however, a deceleration is increasingly apparent. 
  • In a climate of uncertainty, corporate occupiers have adopted a ‘wait and see’ approach to expansion as global take-up volumes have fallen year-on-year. Corporates are trending towards sale and lease back transactions as they look to release capital. 
  • Leasing activities have improved from the Q1 lull, but is still below 2011 levels due to weak jobs growth, slow corporate hiring and the downward reset of global growth projections. Gross leasing volumes for full-year 2012 expected to be 10% lower than in 2011.
  • On the other hand, vacancy continues to edge downwards, with the global office vacancy rate falling to 13.3% in Q2, the lowest since 2009.  Regionally, the Americas and Asia Pacific regions have continued to see vacancy rates fall, while they have remained unchanged in Europe.  
  • With global office supply still falling, the Jones Lang LaSalle Global Office Index, which tracks the rental performance of prime office space across 90 major markets, has continued to grow, up by a further 0.6% during Q2 2012.
  • In residential, high trading volumes have been recorded for Germany, while momentum has been maintained in the U.S. rental apartment market. In Asia, residential sales have improved in China and Hong Kong and remain resilient in Jakarta, driven by investor interest, low lending rates and rising rental returns.
  • Retail exhibited a mixed picture. While Greater China recorded strong demand and healthy rental growth, market conditions were relatively flat in the US. In Europe, demand is expected to drive rents in the top retail locations in London, Moscow and Paris in the second half of 2012, while most other European markets will remain broadly stable.


 

Notes to Editors
 
1. Bookmark the Jones Lang LaSalle Global Market Perspective webpage, where you can access the full report and feature articles. www.joneslanglasallesites.com/gmp/

2. Global Real Estate Health Monitor
 
Global Real Estate Health Monitor.png 
Real Estate Data as at end Q2 2012
 
Definitions and Sources
National GDP: Change in Real GDP.  National Projection, 2012.  Source: IHS Global Insight
OECD Leading Indicator: Composite Leading Indicator:  Change in Index.  Latest Month.  Source: OECD
National Investment Volumes: Direct Commercial Real Estate Volumes.  National Data.  Rolling Annual Change.  Source: Jones Lang LaSalle
Capital Value Change: Notional Prime Office Capital Values.  Year-on-Year Change.  Latest Quarter.  Source: Jones Lang LaSalle
Prime Yield: Indicative Yield on Prime/Grade A Offices.  Latest Quarter.  Source: Jones Lang LaSalle
Yield Gap: Basis Points that Prime Office Yields are above or below 10-year Government Bond Yields.  Latest Quarter.  Source: Jones Lang LaSalle, Datastream
Rental Change: Prime Office Rents.  Year-on-Year Change.  Latest Quarter.  Source: Jones Lang LaSalle
Net Absorption: Annual Net Absorption as % of Occupied Office Stock.  Rolling Annual.  Source: Jones Lang LaSalle
Vacancy Rate: Metro Area Office Vacancy Rate.  Latest Quarter.  Source: Jones Lang LaSalle
Supply Pipeline: Metro Area Office Completions (2012-2013) as % of Existing Stock.  Source: Jones Lang LaSalle
 
About Jones Lang LaSalle 
 
Jones Lang LaSalle (NYSE:JLL) is a financial and professional services firm specializing in real estate. The firm offers integrated services delivered by expert teams worldwide to clients seeking increased value by owning, occupying or investing in real estate. With 2011 global revenue of $3.6 billion, Jones Lang LaSalle serves clients in 70 countries from more than 1,000 locations worldwide, including 200 corporate offices.  The firm is an industry leader in property and corporate facility management services, with a portfolio of approximately 2.1 billion square feet worldwide. LaSalle Investment Management, the company’s investment management business, is one of the world’s largest and most diverse in real estate with $47 billion of assets under management. For further information, please visit our website, www.joneslanglasalle.com.
200 East Randolph Drive Chicago Illinois 60601 │ 22 Hanover Square London W1A 2BN │ 9 Raffles Place #39–00 Republic Plaza Singapore 048619