THE average value of European commercial property transactions fell 35 per cent in the first half as banks granted fewer loans, according to CB Richard Ellis Group Inc.
The average price was 18.4 million euros (S$37.9 million), down from 28.3 million euros a year earlier and 44.4 million euros at the peak of the market in 2007, said CBRE, the world’s largest property broker. The biggest deal was the sale of properties owned by failed company Dawnay Day Group in the UK for more than £600 million (S$1.43 billion), CBRE said.
Commercial property investors are struggling to finance large purchases in Europe after banks curbed lending in the credit crunch and stopped securing bonds against buildings. There were nine transactions valued at more than 200 million euros in the first half, compared with 40 a year earlier, according to the broker.
‘Appetite for lending on large transactions has been very limited since the second half of 2007,’ said Jonathan Hull, CBRE’s executive director of European capital markets. ‘In recent months, we have seen greater willingness to lend.’
Source: Business Times, 15 Aug 2009
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