IREI: Barcelona and Paris: A tale of two cities
Unlike key office markets in the US and UK that are in deceleration mode, the large majority of Europe’s core office targets are in clear positive rent growth territory.
One notable absentee from the party, however, is Barcelona. The Spanish city’s office areas have finished low down in a rental growth forecast list of 18 core submarkets analysed by Green Street Advisors.
Peter Papadakos, Green Street’s lead research analyst for the continental European region, says that while he and his colleagues forecast that nominal rents will grow close to the rate of inflation, they project rent-free periods to expand, hence their weak net-effective-rent growth projections for Barcelona.
Paris, in contrast, is heading in the opposite direction, partly due to President Emmanuel Macron’s pro-business credentials.
“Our projection of market rev-PAM per annum is 6 percent for Paris CPD, close to 4 percent for La Défense, and mid-4 percent for other submarkets in the city,” explains Papadakos.
To read the full article from IREI, click here.