Investors upbeat despite fall in European retail deals says JLL

Retail transaction volumes in continental Europe reached €3.9bn (£3.1bn) in the first quarter of 2008, compared with €4.1bn (£3.3bn) the same time last year, according to research from Jones Lang LaSalle (JLL).   However, despite the drop in activity, JLL said investors remained upbeat about the retail sector in continental Europe despite the deterioration of liquidity in the debt markets.   JLL director European Retail Capital Markets Richard Bloxam said: “The fundamentals of the retail sector across continental Europe remain broadly positive, with strong occupier demand for prime property and retail sales growing in most of continental Europe.   “Prime yields have therefore remained fairly resilient, with only a slight outward movement in yields in some markets.   “We expect transaction volumes to remain below 2007 levels in the coming months, but we anticipate these to pick up again once the new pricing benchmarks have been set.”   Shopping centres were the main target for investors, making up 71% of the volume in Q1, at €2.8bn (£2.2bn).   Supermarkets represented 10% of total investment and retail warehouses 18%.   Germany was the most active market in Q1, accounting for 16% of the transaction volumes.   nathan.cross@rbi.co.uk