Savills IM transacts record €5.5bn in 2017

By James Buckley - Wednesday, January 10, 2018 9:33

Savills Investment Management transacted €5.5bn in 2017, a record annual volume for the firm.

This included €2.95bn of disposals and €2.55bn of acquisitions and compares to the €5bn transacted by the firm in 2016, which itself was a previous record.

The firm saw total activity of €4.5bn in Europe and €1bn in Asia. Markets in which Savills IM was particularly active included the UK, Italy and Japan, where volumes were €1.73bn, €919m and €845m respectively.

There were 147 individual and portfolio transactions across 17 countries coinciding with Savills IM local platform of 18 real estate offices.

Some of the highlights in activity included the purchasing of over €600m of London offices, the purchase of a portfolio of retail warehouses from IKEA Centres in Sweden for €130m for the newly launched Nordic III fund and the purchase of four European assets on behalf of a strategic Asian partner for €450m.

The €2.95bn of sales represented a mixture of disposals from the German mutual funds, such as the sale of a €480m European office portfolio. There was also an element of profit taking in accordance with asset and fund business plan. Examples of which include the sale of a retail asset in Berlin out of the Europe II fund and a logistics asset in Berger, Norway as part of the Nordic Logistic Fund II as well as the €365m sale of mixed-office developments in Italy and two sizeable office assets in Tokyo.

Savills IM had a bias towards logistics in 2017, purchasing over €500m of assets across Europe and over €150m of this was purchased in Poland on behalf of a strategic partner. The firm also successfully launched two funds and achieved eight new managed accounts.

Savills IM currently has significant investment power of over €1bn available to invest in new assets in Europe and Asia in 2018. The firm has an additional €887m in exclusivity heading into 2018.

Kiran Patel, Chief Investment Officer, Savills Investment Management, said: "European real estate markets performed strongly in 2017, experiencing positive rental growth and further yield compression. Market data suggests the UK regained its title as the biggest property investment market in Europe following the impact of Brexit, largely supported by Asian capital flows.

“Looking ahead, there are a number of risks emerging in Europe, including political tensions, a continued weight of money chasing the sector and the consequential impact of a tapering of Quantitative Easing. But we believe the attraction of secure and stable income returns associated with strong supply and demand fundamentals remain strong. Urban logistics, offices in certain major cities, retail parks and other selective retail formats, socio-infrastructure assets and alternatives are expected to outperform.”

jbuckley@costar.co.uk

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