Paris: a worldwide leader in the commercial real estate market

The Parisian commercial real estate market is the second largest in the world in terms of capital invested, just behind New York and far ahead of Seoul, which is in third place.

Despite the economic slowdown felt worldwide, the real estate market remains solid, with record levels of capital available for investment.  According to the JLL group, a leader in commercial real estate consulting, investors thus continue to target real estate, although with more caution and selectivity.  This activity has supported significant business in 2019, even if it might be slightly below that observed in 2018.

Overall investment volumes up worldwide in the 3rd quarter

In the 3rd quarter, volumes invested worldwide in commercial real estate and related services reached $205 billion, a performance up 13% year-on-year, bringing the total invested since the beginning of the year to $550 billion, or 1% more than last year.

While Europe has experienced a slowdown in investment volumes ($176 billion since the beginning of the year, a decrease of 13% year-on-year) mainly due to a decline in activity in the British market linked to investors’ concerns about Brexit, investment volumes in the Americas, mostly carried by the US market, have increased by 9% year-on-year, reaching $245 billion over the last nine months.  Meanwhile, the Asian market reached a record level of $128 billion in 2019, a year-on-year increase of 10%.

Paris leading

Contrary to the trend observed in Europe, activity in France over the first three quarters of 2019 grew by a whopping 16% year-on-year, reaching $27 billion.

International investment flows targeted the Paris market in particular: this accounted for 41% of the amounts invested in commercial real estate in the capital so far this year, or €6.7 billion, out of a total of €16.4 billion.  A dominant share of this international capital was invested by South Koreans, who this year focused on the French market at the expense of the British market.

Paris ahead of the pack

This has made the Parisian market the second largest in the world in terms of capital invested, just behind New York and far ahead of Seoul, which is in third place.

3rd quarter selling prices in Paris are also worth noting: the biggest transaction on the Paris market last quarter, the “Majunga” tower, sold for €910 million to South Korean investor MIRAE ASSET DAEWOO, ranking 3rd in the list of the most expensive transactions worldwide.

Source: Immobilier d’entreprise : Paris reste ciblé par les investissements internationaux