Colliers Market Report Denmark 2023

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Colliers Market Report 2023

Residential by far the largest segment

15 % Office 39 % Residential 20 % Retail 18 % Industrial & logistics

Positive total return in 2022 – but method is misleading

The fact that H2 2022 saw yield requirements and thereby prices coming under pressure is reflected in the year’s total return. Not since 2009 have property returns been this meagre, and similarly, this year’s capital growth is the first since 2012 to be in negative territory. It may seem surprising that the year’s total return turns out positive, but this outcome is largely determined by the applied methodology, involving a full-year compara tive analysis of 2022 and 2021. This has been the histori cal approach to ensure a sufficient basis of observations and data that can be considered valid. As a result, the estimated total return exceedingly mirrors 2021, a year of substantial yield compression, a year-start 2022 that largely continued where 2021 left off, followed by hikes in yield requirements in H2 2022. To gauge the effect from end-2021 to end-2022, we have in this market report included an additional total return analysis, albeit based on fewer observations and with a wider margin of uncertainty. In this period, total return is seen to turn negative, standing at -5.9%, clearly reflecting developments in the market for commercial and invest ment property since start-2022. The decline is driven mainly by yield decompression, which seen in isolation has reduced the total return by 11.6 ppts.

2 % Hotel 7 % Other

International investors predominate the Danish market

54 %

46 % Domestic

International

Core assets continue to drive the market

61 % Core 23 % Value-add 5 % Opportunistic 11 % User

Note: Total transaction volume 2022, Denmark, by segment, investor origins and risk profile. Please also refer to Definitions, p. 117. Source: Colliers

TOP 5 transactions | All segments

Property

Location Seller

Buyer

Type

Area Price 1

Copenhagen/ Aarhus

Project Nacre 2

NREP

OCP

Residential

110,000

~4,800 3

Four Magasin properties 2

ATP Ejendomme & PensionDanmark

Peek & Cloppenburg (Magasin)

Retail

135,000

~4,400 3

All Denmark

Copenhagen/Kgs. Lyngby/Aarhus

Student housing 2

Basecamp

Xior Student Housing

Residential

67,000

~3,400 3

Galleri K

Copenhagen K

Aviva Investors

Jeudan

Retail

25,000

~2,200 3

Supermarket portfolio 2

Cibus Nordic Real Estate

Retail

76,000

2,080

Greater Copenhagen SG Nordic Real Estate

Note : The listed transactions include disclosed sales only. Certain confidential or off-market transactions are not included. 1 Prices quoted in DKK million (rounded figures). 2 Portfolio sale. 3 Indicative due to confidentiality. Source : Colliers