Olympics and public transport upgrade will boost Paris in ’24

The combination of higher interest rates, the co-working phenomenon with its implications for office demand, and ESG investment requirements have all conspired to reduce Parisian real estate values.

But there is potential for values to increase in 2024, according to Benjamin Cartier-Bresson, Head of Paris Office, Berlin Hyp.

“The fact that rents have increased dramatically in Paris CBD, so investors or tenants will have to to find places which are more affordable, will probably increase demand and make properties in the first ring very attractive again,” he told Real Asset Insight’s Richard Betts.

Berlin Hyp is spending time on its portfolio said Cartier-Bresson and, given the falls in value, some sort of deleveraging has to occur.

“Nevertheless, we are continuing to lend, mainly against office properties shopping malls and logistics. Besides that, we also do some financing for alternative assets such as managed residential properties.”  He said that these are a niche say market but can be very interesting.

The Olympic Games, due to be staged in Paris in 2024, will have an effect, notably because investors owning retail property have upgraded their assets, “and that’s very nice for the market in general”.

But Cartier-Bresson said that the Grand Paris Express will have a larger impact. “It’s more sustainable over time while the Olympics will only last three weeks,” he added.