Altus Group Releases Q2 2024 Analysis on European CRE Trends
LONDON, Aug. 19, 2024 (GLOBE NEWSWIRE) -- Altus Group Limited (“Altus Group” or the “Company”) (TSX: AIF), a leading provider of asset and fund intelligence in the commercial real estate (“CRE”) sector, has published its analysis of Q2 2024, which focuses on property valuation trends across Europe.
Quarterly Insights into Commercial Property Valuations
Every quarter, Altus Group gathers and standardizes CRE valuation data from the European market, providing detailed insights into the factors that affect commercial property values. The dataset for Q2 2024 features open-ended diversified funds throughout Europe, which collectively manage an impressive €29 billion in assets. These funds cover 17 countries and represent key sectors, including industrial, office, retail, and residential properties.
Reported Trends in Property Values
According to Phil Tily, Senior Vice President at Altus Group, “Property values in the Pan-European valuation dataset remained relatively stable in Q2 2024, showing a slight sequential decline of just -0.06% compared to Q1 2024. This marks the smallest drop since the downward trend began in Q3 2022. Over the past eight quarters, overall property values in this dataset have decreased by a total of 16.5%. The minimal decline in Q2, along with a recent reduction in interest rates, indicates improved stability as the pace of value declines is significantly slowing.”
Interest Rate Impact and Market Dynamics
Despite a 25 basis point cut by the European Central Bank, yields have continued to rise for the ninth consecutive quarter, putting additional downward pressure on property values, although at a slower rate. Across all sectors, small single-digit yield increases were noted, leading to a -0.7% change in values across the dataset. Fortunately, a slight improvement in cashflows has allowed appreciation levels to shift positively in all major sectors, with the exception of office properties.
Sector Highlights from the Dataset
Here are some key highlights by sector:
- Industrial: This sector stands out as the strongest performer, with values rising by 0.5% compared to Q1 2024. Gains in cashflow contributed positively, adding 1.1% to values, which offset a minor negative yield impact of -0.5%.
- Office: A slight decrease in projected cashflows, combined with a higher-than-average yield increase, has led to further reductions, resulting in a 0.8% decline in values since Q1 2024.
- Retail: In the second quarter, values turned positive with a 0.2% increase, though results varied across different property types. Parks and warehouse properties performed well with a 3.1% increase, while supermarkets saw a smaller improvement of 0.3%. In contrast, shopping centers and high street assets faced negligible downturns of -0.6% and -0.1%, respectively.
- Residential: This sector recorded a 0.3% increase in value since Q1 2024, driven by a cashflow improvement of 0.6%, which outweighed a minor yield offset of -0.4%.
Overview of Altus Group
Altus Group is recognized as a leading provider of asset and fund intelligence for the commercial real estate market. The company offers intelligence as a service to a global clientele through a connected platform that integrates industry-leading technology, advanced analytics, and advisory services. With the trust of major leaders in the CRE industry, Altus Group empowers real estate investors, developers, owners, lenders, and advisors to effectively manage risks and enhance performance yields throughout the asset and fund lifecycle. Headquartered in Toronto, Altus Group operates globally and employs approximately 2,900 professionals across North America, EMEA, and Asia Pacific. For more information about Altus Group (TSX: AIF), please visit www.altusgroup.com.
Contact Information
FOR FURTHER INFORMATION PLEASE CONTACT:
Elizabeth Lambe
Director, Global Communications, Altus Group
+1-416-641-9787
elizabeth.lambe@altusgroup.com
Frequently Asked Questions
1. What is the main focus of Altus Group's Q2 2024 report?
The report analyzes valuation trends within the European commercial real estate market for the second quarter of 2024.
2. How much assets under management were included in the dataset?
The Q2 2024 aggregate dataset included €29 billion in assets under management across various sectors.
3. Which property sector showed the most significant value increase?
The industrial sector demonstrated the strongest performance with a value increase of 0.5% over the previous quarter.
4. What trend was observed in office property values?
Office properties experienced a decline in values by 0.8% due to reduced projected cashflows and increased yield.
5. Who can be contacted for more information regarding the report?
For further inquiries, contact Elizabeth Lambe, Director of Global Communications at Altus Group, via +1-416-641-9787 or elizabeth.lambe@altusgroup.com.
