Commercial property indices - 2014 H2
20/07/2015 - Press Releases
1. Office Indices
Office price index
In 2014, the annual rate of change of nominal prime office prices for the country as a whole was -3.3% (provisional data), with the rate of decline having slowed compared with 2013 (-9.9%) and 2012 (-11.9%). The corresponding average annual rates of decline were 3.2% for Athens, 4.6% for Thessaloniki and 3.1% for the rest of Greece.
In the second half of 2014, nominal prime office prices for the country as a whole declined by 0.6% compared with the first half of 2014 (provisional data). This rate of decline was lower compared with previous half-years (2013 H2: -3.4%, 2014 H1: -1.2%). Additionally, between the first and the second half of 2014, nominal prime office prices declined by 0.1% in the greater Athens area and by 1.2% in Thessaloniki and the rest of Greece.
Office rent index
In 2014, office rents for the country as a whole decreased by 10.0% (provisional data) in average nominal terms. The corresponding average annual rates of decline are estimated at 6.9% for the greater Athens area, 8.3% for Thessaloniki and 13.9% for the rest of Greece.
In the second half of 2014, office rents for the country as a whole declined by 2.1% (provisional data) compared with the first half of 2014, a lower fall compared with previous half-years (2013 H2: -6.1%, 2014 H1: -6.1%)
2. Retail indices
Retail price index
In 2014, the annual rate of decline of prime retail prices for the country as a whole was 1.0% (provisional data) in average nominal terms, a considerably lower fall compared with 2013 (-8.8%) and 2012 (-11.1%). The corresponding average annual rates of change are estimated at -2.4% for the greater Athens area, -0.8% for Thessaloniki and 0.9% for the rest of Greece.
In the second half of 2014, prime retail prices for the country as a whole increased by 1.1% (provisional data) in nominal terms compared with the first half of 2014. A rise in prices was also recorded in the first half of 2014 (1.8%), in contrast to the second half of 2013 when prices had declined by 6.4%. In the second half of 2014, nominal prime retail prices increased compared with the previous half by 1.2% in Athens and in Thessaloniki and by 1.0% in the rest of Greece.
Retail rent index
For 2014 as a whole, retail rents for the entire country decreased by 9.3% (provisional data) in average nominal terms. The respective rates of decline are estimated at 9.1% for the greater Athens area, 9.2% for Thessaloniki and 9.7% for the rest of Greece.
In the second half of 2014, retail rents for the country as a whole declined by 7.2% (provisional data) compared with the first half of 2014. This rate of decline is significantly higher than in previous half-years (2013 H2: -1.7%, 2014 H1: -5.2%).
Detailed tables on retail and office prices and rents by geographical area are published in the “Bulletin of Conjunctural Indicators” (Tables ΙΙ.9, ΙΙ.10, ΙΙ.11 and ΙΙ.12, first published in Issue 162) and are also available on the Bank of Greece’s website.
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INDICES OF COMMERCIAL PROPERTY PRICES AND RENTS
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(within parentheses, percentage change over the previous period)
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2012
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2013
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2014*
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2013
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2014 *
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Η1
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Η2
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Η1*
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Η2*
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Ι. OFFICE PRICE INDEX (2010=100)
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Total
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Index
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81.8
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73.7
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71.3
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75.0
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72.4
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71.5
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71.1
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(% change)
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(-11.9)
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(-9.9)
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(-3.3)
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(-4.8)
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(-3.4)
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(-1.2)
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(-0.6)
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a. Athens
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Index
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85.1
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75.8
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73.3
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77.5
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74.0
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73.4
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73.3
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(% change)
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(-10.0)
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(-10.9)
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(-3.2)
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(-6.4)
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(-4.5)
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(-0.9)
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(-0.1)
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b. Thessaloniki
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Index
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81.4
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73.3
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69.9
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75.7
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70.8
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70.3
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69.5
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(% change)
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(-12.2)
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(-9.9)
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(-4.6)
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(-2.7)
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(-6.4)
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(-0.8)
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(-1.2)
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c. Rest of Greece
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Index
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78.3
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71.5
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69.3
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72.0
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70.9
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69.7
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68.9
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(% change)
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(-14.0)
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(-8.7)
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(-3.1)
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(-3.2)
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(-1.5)
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(-1.7)
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(-1.2)
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ΙΙ. OFFICE RENT INDEX (2010=100)
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Total
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Index
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86.4
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80.0
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72.0
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82.5
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77.5
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72.7
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71.2
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(% change)
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(-9.7)
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(-7.5)
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(-10.0)
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(-2.5)
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(-6.1)
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(-6.1)
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(-2.1)
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a. Athens
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Index
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86.5
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80.2
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74.7
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81.8
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78.6
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75.3
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74.0
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(% change)
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(-8.5)
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(-7.3)
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(-6.9)
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(-3.3)
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(-4.0)
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(-4.1)
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(-1.7)
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b. Thessaloniki
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Index
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91.3
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84.5
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77.5
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85.4
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83.7
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78.3
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76.7
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(% change)
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(-4.2)
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(-7.4)
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(-8.3)
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(-5.1)
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(-2.0)
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(-6.4)
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(-2.1)
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c. Rest of Greece
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Index
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85.4
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78.8
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67.9
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82.6
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75.0
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68.7
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67.0
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(% change)
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(-12.1)
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(-7.7)
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(-13.9)
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(-1.1)
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(-9.2)
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(-8.4)
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(-2.5)
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ΙΙΙ. RETAIL PRICE INDEX (2010=100)
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Total
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Index
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82.6
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75.4
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74.6
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77.9
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72.9
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74.2
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75.0
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(% change)
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(-11.1)
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(-8.8)
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(-1.0)
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(-4.8)
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(-6.4)
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(1.8)
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(1.1)
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a. Athens
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Index
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80.2
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73.6
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71.9
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76.7
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70.6
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71.4
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72.3
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(% change)
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(-13.1)
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(-8.2)
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(-2.4)
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(-3.5)
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(-7.9)
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(1.2)
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(1.2)
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b. Thessaloniki
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Index
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79.3
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73.1
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72.5
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74.3
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71.9
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72.1
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73.0
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(% change)
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(-13.2)
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(-7.8)
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(-0.8)
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(-4.5)
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(-3.3)
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(0.4)
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(1.2)
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c. Rest of Greece
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Index
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87.5
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78.9
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79.6
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80.9
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76.8
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79.2
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80.0
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(% change)
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(-7.3)
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(-9.8)
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(0.9)
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(-6.8)
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(-5.0)
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(3.0)
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(1.0)
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ΙV. RETAIL RENT INDEX (2010=100)
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Total
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Index
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84.6
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76.2
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69.1
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76.9
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75.6
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71.7
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66.5
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(% change)
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(-8.7)
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(-9.9)
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(-9.3)
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(-8.2)
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(-1.7)
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(-5.2)
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(-7.2)
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a. Athens
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Index
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84.3
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73.6
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67.0
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74.2
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73.1
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69.9
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64.0
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(% change)
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(-7.1)
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(-12.6)
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(-9.1)
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(-11.1)
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(-1.4)
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(-4.4)
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(-8.3)
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b. Thessaloniki
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Index
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85.2
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80.6
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73.2
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82.1
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79.0
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76.3
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70.0
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(% change)
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(-10.3)
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(-5.5)
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(-9.2)
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(-1.9)
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(-3.7)
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(-3.5)
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(-8.2)
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c. Rest of Greece
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Index
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85.1
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79.2
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71.5
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79.7
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78.6
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73.3
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69.6
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(% change)
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(-10.9)
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(-6.9)
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(-9.7)
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(-5.3)
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(-1.4)
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(-6.7)
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(-5.1)
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Source: Bank of Greece.
*Provisional data.
Notes:
1. For the purposes of monitoring and analysing the commercial property market, the Real Estate Market Analysis Section of the Bank of Greece compiles office and retail property indices, using data from credit institutions (Bank of Greece Executive Committee Act 23/26.07.2013) and Real Estate Investment Companies – REICs (Bank of Greece Executive Committee Act 9/10.01.2013) operating in Greece, as well as data from other sources, e.g. private real estate consultants, portfolio managers, real estate developers, real estate brokers and public sector entities. The data are collected on a biannual basis and include valuations, rents, transactions, investments and yields of commercial property and commercial property asset portfolios.
2. Indices are published on a biannual basis (base year: 2010). They concern office and retail uses and refer to price and rent levels of mainly prime investment property. It should be noted that price indices are valuation-based and are therefore expected to show some lag, especially in cases of negative changes. Furthermore, especially in periods of limited transactions, the values tend to reflect sentiment and market expectations at the moment of the valuation.
3. The discrepancy between price and rent trends, recorded throughout 2014, can be explained by: i) the differences in the two samples (price indices are based on an A and upper B class investment property sample, whereas rent indices are based on a broader sample, from both the primary and secondary markets), ii) the fact that valuations –through yields – take into account sentiment and positive medium-term expectations and iii) the fact that a significant number of downward rent adjustments took place in 2014 (probably as a result of review processes that had started earlier but were completed in 2014).