# 1 2017 CONSTRUCTION, PROPERTY AND INVESTMENT IN COPENHAGEN AND MALMÖ REGION Scandinavian property magazine INVESTMENT DEVELOPMENT OPPORTUNITIES MEDIA ESTATE N RDIC Scandinavian property magazine INTERNATIONAL INVESTORS FLOCK TO GREATER COPENHAGEN 2016 was a record year for property transactions PUBLISHER Estate Media Nordic ApS in Denmark, and with good reason: Copenhagen [email protected] offers excellent investment opportunities and Tlf. (+45) 22 16 19 39 very attractive yields; and, these past 5 years, the number of international investors on the market has grown significantly. Their presence makes for a ADVERTISING market that is more liquid than ever before and this, in turn, encourages more investors. Tel. direct (+45) 28 34 03 19 [email protected] The Greater Copenhagen region encompasses Copenhagen, on the Danish side of the Strait, and Malmö on the Swedish side. Together, these cities create a region with a population of almost 4 EDITOR-IN-CHIEF million. Copenhagen is linked to Malmö by state-of-the-art infrastructure and both cities are ramping Kamilla Sevel up investment. Tlf. (+45) 42 76 00 20 [email protected] When it comes to investment, Greater Copenhagen, have enormous appeal. Population growth is explosive around the Danish capital, and demand is so strong that the housing sector can’t keep up. DESIGN AND LAYOUT The industry is busy building, but still more is needed. Karin Friis www.kontur.design In recent years, more and more international companies have chosen Copenhagen for their Scandina- vian headquarters, increasing demand for office space and lowering vacancy rates. PRINT Massive investment is also channeled into developing universities and research facilities—all with the Rosendahl purpose of creating the foundation for a lively business community going. And it is working. Greater - Schultz Grafisk ISSN nr. 1904-2434 Copenhagen is receiving many honors these days ranging from most livable city to the world’s best city for new talent. Axel Tower, a new office building in Copenhagen just across from Tivoli. Read more about the property market and the attractiveness of the region in this magazine; and, at Photo: ©News Øresund - Jenny Andersson. MIPIM, check out the Greater Copenhagen stand (no. P-1.K14) to hear representatives from Malmö and Copenhagen present the region. 5 7 04 5 1 04 TRYKSA G Please do remember to sign up at Estatemedia.dk for daily Danish news on the property market or mail Editor-in-Chief Kamilla Sevel at [email protected] for more info on media or news. Enjoy your reading! Best regards, Kamilla Sevel Editor-in-chief Estate Media Please do call us if you want to get in contact with the Danish property industry through our publications or knowledge events. Mira Trolle Scheel Director, Partner [email protected] Tel. +45-27 28 14 15 ESTATE MEDIA - Media and Knowledge House specialized in the Property Industry DO YOU WANT TO BE PART OF THE EXQUISITE PROPERTY POTENTIAL IN DENMARK? Capital Investment is the preferred Danish partner for international investors looking to invest in residential and commercial properties. We have a comprehensive service portfolio for investment ready clients, and we offer a unique product in the Danish property market. Find us at capitalinvestment.dk CI_annonce_scan_prop.indd 1 12/02/15 11.53 COST-EFFICIENT OFFICES EXCELLENT LOCATION ØRESTAD WHERE EMPLOYEES WANT TO LIVE AND WORK ØRESTAD IS A UNIQUELY LOCATED AREA IN COPENHAGEN WITH A LOCAL FEEL OF ITS OWN Just 10 minutes from Scandinavia’s largest airport, 10 minutes to ØICC NETWORK FOR INNOVATION AND ENTREPRENEURSHIP the historic city of Copenhagen and right next to Copenhagen’s big- gest nature park, in Ørestad you’re within easy reach of everything. 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DYNAMIC UNIVERSITY CAMPUS This will also help to attract the most talented employees from Denmark and abroad. VIBRANT CULTURAL AND ENTERTAINMENT SCENE ABOUT CPH CITY & PORT DEVELOPMENT CPH City & Port Development is the largest development company in Denmark, responsible for Copenhagen’s prime locations – the Ørestad, Nordhavn and Sydhavn districts. All our sites are centrally located in Copenhagen in great surround- ings with excellent infrastructure and public transport. www.byoghavn.dk About us Nybolig Erhverv København A/S is one of the leading real estate agents in Denmark dealing with investment properties in and around Copenhagen. As the Danish cooperation partner of Savills, our outstanding global reach enables us to offer impeccable and unsurpassed advisory on cross-border investments and transactions at all times. Investments Lettings Our highly skilled sales professionals Our experienced lettings department of- Nybolig Erhverv København A/S have many years of experience and in-de- fers our clients specialised and highly pth local market knowledge of investment competent advisory in relation to lettings properties. We offer professional advisory of commercial properties and premises, - Investment Properties in Copenhagen in relation to residential tenanted properti- including offices, production/warehouses es as well as all kinds of commercial pro- and stores. perties. Tenant Representation Valuation & Research Our dedicated tenant representation de- Best-in-class market intelligence is the re- partment knows the market and advises sult of key research, experience and supe- companies during the whole process of rior analysis, which are all factors placing finding a new lease - from the initial iden- us ahead of our peers when determining tification of needs, through the planning the value of investment properties at any and prioritisation of alternative leases to given time. the final negotiations on the contract. Copenhagen: Vester Farimagsgade 7, 3. · 1606 Copenhagen Nybolig Erhverv [email protected] · Tel. +45 3364 6500 København A/S nyboligerhverv.dk/koebenhavn Other branches: Hillerød: Søndre Jernbanevej 4E, 2. · 3400 Hillerød [email protected] · Tel. +45 3364 6500 Scandinavian property forår 2017_15.02.17.indd 1 21-02-2017 12:43:07 GREATER COPENHAGEN COPENHAGEN - Over the last five years, foreign investors have dominated the retail segment, and 2016 was no exception. However, during 2016, the residential and office segment also experienced increasing interest from foreign investors, and all together, these three segments accounted for approxi- mately 85 per cent of the entire foreign investment volume in 2016, says managing partner Nicholas Thurø. Here Købmagergade 3 sold by Aberdeen Asset Management in December. - During the last couple of years, the Indeed, the foreign investors have contri- were registered in the office segment. Danish transaction volume has increased buted to an even further yield compres- significantly, and this year’s volume of sion than what we experienced in 2015. The Copenhagen area accounted for 74 approx. €8,5 bn almost reached the This is particularly evident within the per cent of the total investment volume. same level as we observed in 2006 of above-mentioned segments, where prime approx. €8,9 bn – which was an all-time yields and prime market rents have rea- - In the past year, corporations have been high. In a market where the European ched a level of 4 per cent and €250 per sq executing more and more sale & lease- transaction volume faced a significant m within the office segment, 3.60 per cent back transactions, and these transactions decline, especially driven by lower and €295 per sq m within the residential accounted for approx. €880 million of the investments in London, the Danish segment, and 3 per cent and 3,135 per sq total investment volume in 2016. Com- transaction volume within commercial m within the retail segment. In the year- pared to 2015 this is almost double the real estate actually rose by a total of 18 end a few sub-4 per cent transactions amount. Especially the toy chain Top-Toy, > per cent, according to a newly published report by property consultants RED Property Advisers. PRIME OFFICE YIELDS (IN PER CENT) At the same time the unemployment rate in the Copenhagen Area has slightly SUB AREA Q1 2015 Q1 2016 Q1 2017 decreased over the course of 2016, and Copenhagen City (CBD) 5.00 4.25 4.00 is expected to decrease even further in Copenhagen E & W 5.75 5.50 5.25 2017. The decreased unemployment rate Frederiksberg 5.75 5.50 5.25 together with the decreased vacancy rate in the fourth quarter of 2016 will Harbour areas 5.00 4.25 4.00 likely lead to an increasing demand for South Harbour 6.00 6.00 5.50 office space. Ørestad 5.75 5.50 5.50 Copenhagen N & NW 6.50 6.50 6.25 With several uncertainties in the ma- croeconomic environment, including the South and West of Copenhagen 7.25 7.25 7.00 consequences of Brexit and the impact North of Copenhagen 5.25 5.25 5.00 of the new U.S. administration led by SOURCE: RED PROPERTY ADVISERS. Donald Trump, more and more investors are turning to the stable cash flow and inflation hedging merits of real estate. PRIME RETAIL YIELDS (IN PER CENT) DANISH TRANSACTION - Consequently, it is not only the Danish STREET/SUBMARKET Q1 2015 Q1 2016 Q1 2017 investors who are active on the Danish Strøget (incl.