The Finnish property transactions volume increased to some €2.5 billion by the end of April, boosted by several large portfolio transactions. Strong investment demand continues to pressure prime yields, which, for instance, in Helsinki CBD stand at all-time low levels. Weak economic conditions are reflected in the commercial property rental markets, where office rents have decreased slightly. However, the amount of vacant office space seems to have stopped increasing, as demolitions and change of use projects equal the amount of new development. Retail property development is currently active in Helsinki metropolitan area, driven by population growth and new public transportation infrastructure. Residential investment has increased in attractiveness rapidly. Residential properties have produced the highest returns in recent years, supported by continuous rental growth in all major cities.
Read more at the new KTI Market Review.