Market Report 2022

Colliers Market Report 2022

9

TOP 5 economies to have done best during the COVID-19 pandemic in 2021

Hotel Industrial/logistics Retail Residential Of f ice

1. Denmark 2. Slovenia 3. Sweden 4. Norway 5. Chile

Note : Excerpt from The Economist analysis of 23 wealthy countries, released on 1 Jan. 2022. Source : The Economist

erties in Nærheden, west of Copenhagen. Starwood entered the Copenhagen hotel market with the acquisitions of Hotel Sankt Petri and Comfort Hotel Vesterbro, and Swiss Life made their first property investments in Denmark when acquiring a DKK 520 million Copenhagen residential portfolio and a residential property in Risskov, Aarhus, at just shy of DKK 300 million. Residential property driving activity During the coronavirus pandemic, the residential market has proved highly resilient, boosting investor demand for residen tial property in 2021. This is reflected in the fact that residential property accounted for 56% of investment volume, just as four of the year’s top-5 transactions involved residential property. The substantial placement requirements of domestic and for eign institutional investors alike have driven down yield require ments to an all-time low, with the net initial yield on proper ties subject to open market rent for the first time ever falling below the 3.00% mark in 2021. One example was the acquisi tion by CBRE Global Investors of a 128-unit residential building at Marmorbyen in the Copenhagen district of Nordhavn. Because of fierce competition for investment opportunities in the largest cities, several domestic and established foreign investors are increasingly opting for investments in the munic ipalities surrounding Copenhagen, or in high-growth provincial

towns and cities on Funen and in Jutland. The largest transac tion in 2021, namely AP Pension’s acquisition of property com pany Bostad at approx DKK 3.4 billion, serves as an exam ple. Comprising more than 70 residential properties across 12 regional locations, this transaction attracted great investor interest in Denmark and from abroad. Another example was the acquisition by Goldman Sachs of a DKK 600 million portfo lio in three Jutland towns from Birch Ejendomme, just as Niam made multiple prominent acquisitions across the country. In addition, at year-end 2021, NREP acquired a portfolio of 23 res idential properties, located mainly in Odense, at a price just shy of DKK 1 billion. Apart from the residential market, the industrial/logistics mar ket was exceptionally coveted in 2021, with the transaction vol ume across Denmark more than doubling in this segment com pared to 2020. More than anything, investors have targeted up-to-date, high-volume logistics facilities in attractive loca tions. The 2021 increase in transaction activity is mainly attrib utable to a wider supply than previously. The main drivers of the increase in supply are stronger newbuilding activity fuelled by a buoyant letting market and the fact that several owner-oc cupiers have started to net the profits from sale & leaseback Market for I&L facilities has more than doubled compared to 2020