The ECB’s Quantitative Easing Program will Boost Property Markets in the Eurozone.

The ECB surprised markets this week by announcing the size of its quantitative easing (QE) program, which could assist to stabilize recent bond yield and currency losses and pave the path for greater inflation expectations and better GDP growth. hotel apartments
Of doubt, maintaining market confidence will be critical in the near term, but the QE program must inspire governments to pursue deeper structural reforms in the long run. Dedicated reformers, such as Spain, will, in our judgment, be rewarded the greatest with increased activity and inward investment.
Cushman & Wakefield’s Head of EMEA Investment Strategy, David Hutchings, stated, “If the QE program succeeds, it will have a significant influence on property markets in general, as even more demand would be channeled into the market. As a result, yields are projected to decrease further than expected, and volumes will be pushed back even farther toward record levels.”
According to Cushman & Wakefield, absent QE, the market would expect a 5–10% boost in European investment volumes this year, as well as a 20–30 basis point drop in prime yields. With a successful QE package producing lower borrowing costs for longer periods of time, stronger growth, and some reform, that forecast has been raised to a 40–70 basis point yield drop and a 20%+ increase in property trading.
Cushman & Wakefield also points out that this assumes investors can discover the stock they want to buy, which is based on bank sales and deleveraging, profit taking, and stock recycling. Hutchings, on the other hand, claims that “We can anticipate growing interest in a variety of global markets as Europeans export wealth in pursuit of possibilities, as well as a return to development, aided by recent commodity price drops that have lowered construction costs. Furthermore, we anticipate increased business activity, such as asset sales by corporations, joint ventures, and takeovers.”

Europe’s Central and Eastern Front The value of commercial real estate is increasing.
Investor-led deals reached €7.8 billion in 2014 across all commercial real estate markets in Central and Eastern Europe. Poland was the most active market in CEE, with sales and acquisitions totaling €3.2 billion, while other countries in the area saw considerable rises in investor activity.
According to Troy Javaher, CEE’s Head of Capital Markets, “JLL handled both sophisticated portfolio transactions and single mandate sales and acquisitions, which is significant. With numerous high-profile portfolio sales, the industrial sector was exceptionally busy, and JLL was the clear market leader in these industrial transactions. The firm excelled not only in premier property transactions, but also in opportunistic and value-added services. For more than a decade, the JLL Capital Markets teams have held the top spot “..
The investment markets in Central and Eastern Europe had a successful year in 2014, with total transaction volume of around €7.8 billion, up from €6.2 billion the previous year. With a market share of roughly 41% in CEE, Poland remained the most important regional market, followed by the Czech Republic and Romania.
JLL Poland’s Managing Director and Head of Capital Markets, Tomasz Trzóso, added, “In 2014, the Polish market saw roughly €3.2 billion in transactions. The greatest office investment volumes since 2006 were recorded in 2014, reaching €1.8 billion. In addition, Poland’s regional city markets saw greater investor interest than ever before in the office sector, with over €440 million in transactions in 2014. This is greater than the previous five years’ cumulative transactional volume in these markets. We also saw a record number of warehouse transactions of €744 million and retail transactions of €570 million. A key finding across all sectors is that a number of transactions have slid into 2015 or were started late in 2014, implying that 2015 would once again offer strong outcomes, aided by landmark deals in all industries “..