INVESTMENT VOLUME AT LOW LEVEL BUT SLIGHTLY MORE ACTIVITY IN SECOND QUARTER
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The Frankfurt investment market for commercial property recorded a transaction volume of €852 million by the end of the first half of the year. This significantly exceeded the result from the same period of the previous year by around 92%. Nonetheless, the current H1 result is still at a very low level, falling short of the long-term average of €2.3 billion by a good 63%. On a positive note, however, it shall be noted that after a very subdued first quarter (€174 million), a certain momentum has returned to the market in the past three months. At €679 million, the second quarter can at least be considered solid under the current conditions.
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In the ranking of A-locations, Frankfurt has thus moved up to third place behind Berlin (€2bn) and Munich (€1.5bn). Considering only the office asset class which is traditionally dominating the Frankfurt investment market, the banking metropolis is the nationwide leader despite the fact that transaction activity in this segment has remained well below average. Although there is still a lack of triple-digit deals and, in particular, purchases of office towers, a large part of the investment volume in q2 can still be attributed to this asset class, which accounted for around €524 million in Frankfurt in the first half of the year.
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Meanwhile, prime yields have stabilised as expected, so that no further adjustment has been observed since the beginning of the year. The net prime yield for office properties is quoted at 4.50% and therefore still above the logistics segment, for which 4.25% can be assumed. Mixed-Use city highstreet properties with focus on retail are currently priced at 3.75%.