BMI View: Commercial real estate prospects have improved in the wake of the inauguration of Macron inQ217, with transactional and leasing activity rising as business confidence grows. Office and retail subsectorswill be subject to pent-up demand for quality premises in centralised locations, whilst industrial realestate is set to remain stable due to steady demand from logistics firms.
French real estate is poised for a strong recovery following the result of the May 2017 elections, as theinauguration of Macron is considered a stable choice for the business environment. Reforms are on the wayas the new administration looks to tackle a historic period of low economic growth, labour marketdifficulties, high unemployment and entrenched bureaucracy. The outlook for Europe's second largesteconomy has drastically improved, and with it the potential for market capitalisation in the commercialproperty sector.
Paris will continue to observe the highest rate of demand and transactional activity for commercial realestate, since the capital benefits from its strong position as an economic hub for financial services, tech,retail and manufacturing. Marseilles, the second city we cover in our forecast, is supported by a large freightindustry and represents an important trading centre for the region; the industrial sub-sector tends to be theoutperformer here with a steady stream of demand from both domestic and foreign occupiers. Whilst inNice, the third city in our forecast, the main economic driver is the tourism industry, sustaining gooddemand for high-end retail in the city.
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