Cyprus Only European Market to Resist International Downswing of Commercial Real Estate
Nicosia, Mar 19 - Cyprus is the only European market to resist the international downswing of the commercial real estate market, according to the latest survey from RICS (Royal Institution of Chartered Surveyors), Global Commercial Property Survey Q4 2008, released in Nicosia on Thursday.
As European commercial real estate market plunged into recession with the sharpest falls registered in Ireland, Slovakia and Scandinavian countries, Cyprus real estate commercial market was able to escape the worsening economic climate, during the fourth quarter of 2008.
It is the first time in the survey’s history that capital values plummeted across so many markets.
The RICS survey shows that all European countries have shown substantial changes in rents with dramatic reductions across Europe, and Cyprus being the only country that shows an increase, with 30% of those asked indicating a positive change in rental prices. The survey indicates that although all of those asked marked a decrease in tenant demand in the last quarter of 2008, Cyprus only showed a 20% decrease in relation to the 60% decrease indicated by those asked in Germany, Switzerland and Luxembourg.
The RICS marks as the most significant fact derived from the survey, the fact that Cyprus comes second in the commercial property rents ranking worldwide; with 30% of those asked indicate a positive trend. The only other countries worldwide with a marked positive change in rent ranking worldwide are Africa (excluding South Africa) with 45%, Brazil with 30%, Africa (with South Africa) with 15% and Columbia with 5%.
However, RICS sees the reduction in investment bidders, as the only fact that may disrupt the relatively positive or stable position of the Cyprus commercial property market. As far as the Cyprus market is concerned, a 100% of those asked indicated a reduction, as in Belgium, Denmark and France. This is considered as a distinct negative trend, especially in comparison to Italy, Germany and Greece that showed a decrease of 90%, 65% and 60% respectively, and Luxembourg, which indicated the lowest reduction at 40%.
RICS’ Global Commercial Property Survey was based on information collected from leading international real estate organizations and local firms. Survey questionnaires were sent to real estate organizations in December 2008, with responses received up until the 14th of February 2009. Respondents were asked to compare conditions over the latest three months with the previous three months. A total of 427 responses were received.