France promise good as Brexit gifts ‘Number Two’ status

Prospects for the commercial real estate investment market in France are promising in 2022 according to Faro Capital Partners managing partner Guillaume Turcas.

The market, particularly Greater Paris, has moved into the Number Two slot behind Germany, Turcas said, thanks to Brexit.

But change is underway, particularly following the covid pandemic. As in other European locations, “People are shying away from offices,” Turcas told Real Asset Insight’s Richard Betts. The explanation is that the long term is “a bit more cloudy” owing to the impact of covid and the working-from-home phenomenon.

Beds and sheds are in the spotlight instead , with logistics yields down to 3.5% – unthinkable five or six years ago, Turcas remarked.

And, even though the logistics market is now crowded there is still a bright future there, although obtaining a lot of value from it needs a special angle.

Turcas said that the “beds” market in France is not like that in Germany or Ireland and is a hard market to penetrate. “But it is a segment that more and more institutions want to get into,” he added.

After the GFC, investors began to shy away from mainstream sectors and much more into operational real estate, he added.

Click on the video to watch the full interview or listen to the podcast below.