Is France the best real estate market to invest in?
2019 was the year of records for France’s commercial real estate market. Overall investments jumped 16% to reach €35.4bn, while offices (€25bn) and logistics (€5.1bn) had their best year ever. Even the much-maligned retail sector managed to register its 3rd best performance in history, at €5.3bn.
Opportunities abound across the Hexagone in all real estate asset classes, and investors have clearly taken notice. Enough to satisfy the expectations of foreign investors, who have been increasingly active in France in recent years, representing 45% of French CRE investments in 2019.
World’s leading commercial real estate market in 2019
Offices were the asset class of choice for a majority of investors in 2019, with investments totalling €25bn, an activity largely concentrated in the Greater Paris area (88%). The timing could not be better for such an appetite as office production in Île-de-France rose 13%yy, at 2,275,000 sqm, according to Deloitte’s 33rd Grand Paris Office Crane Survey.
Proof of its growing appeal, Paris became the world’s leading commercial real estate investment market in 2019, according to JLL, ahead of New York, Los Angeles and London. An appeal that stems from the economic and political stability observed in the country, but also from the promises made by the Grand Paris Express, Europe’s biggest infrastructure project, which will add four new fully automatic metro lines totalling 205 km, two extended lines and 68 new stations, within the 2020-2030 horizon.
Real estate market opportunities across France
But opportunities are not confined to the capital alone. On the contrary, regional markets are emerging across France as alternatives for investors in search of yields.
Leading the way, Lyon is asserting itself as a Eurocity and a key European market, as evidenced by its record 440,000 sqm office take-up (+32%) and €2.5bn CRE investments (+70%) in 2019.
To the North, Lille is taking advantage of a strategic location – 40 minutes away from Brussels and 1 hour away from London, Amsterdam and Paris by high-speed rail – to attract international companies in its midst, leading its CRE to a remarkable year with office take-up reaching 2600 600 sqm and investments reaching €545m.
Behind the two regional leaders, Aix/Marseille and Toulouse are also operating their economic transformation, leading to numerous opportunities for investors going forward.
Find out more in this exclusive Business Immo white paper.
Top Image: Getty Images – Augustin Lazaroiu