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European commercial property transactions will fall by a quarter in 2008, a new report states.
A study from one of the world’s largest commercial property services firms, which has offices in London, revealed that commercial property is set for further falls over the coming 12 months, after experiencing a 13 per cent drop this year.
The exodus of many debt funded buyers and the fall-out from the US subprime crisis were cited by Tony Horrell, the firm’s head of European capital markets, as the reasons why next year will not be another record year in terms of commercial property trading.
"Even though at the three-quarter stage we were on a par with 2006, the last quarter has slowed down quite a lot, which means that this year we will end up with (volumes of) around £220 billion euros ($322.6 billion)," Mr Horrell is quoted by Reuters news agency as saying.
He went on to add that volumes would slip by a further 20 to 25 per cent to around 170 to 180 billion, because there were now as many sellers as there were buyers on average, across the continent.
Buying and selling of commercial property such as London office space and French shopping malls reached a record 253 billion in 2006, according to Jones Lang LaSalle.