This ViewPoint looks at what might happen now that the UK has voted to leave the EU. It discusses the likely timetable for Brexit, the possible impact on the UK economy and what alternative trade structures might be available for the UK to join. This report goes into further detail on which UK industry sectors might be affected and which European cities might benefit from Brexit relocation. It concludes by looking at what the wider impact on the rest of the EU might be — negative as well as positive. The referendum has happened and there has been a vote to leave the EU. But there is considerable uncertainty over how long the process will take and over what the eventual relationship between the UK and EU will be. We believe that leaving will neither be quick nor dramatic in its effects. Rather, we expect a ‘long goodbye’ stretched out over two years or more. Article 50 of the Lisbon Treaty provides for a two-year exit period once a member state decides to leave, but the UK looks unlikely to serve a formal decision any time soon. We think the Article 50 notice is not likely to be served until late 2017 at the earliest.  

This year’s guide is the largest and most comprehensive yet with 64 EMEA cities featured including certain global hubs such as Hong Kong, New York City and Mexico City. Throughout the guide we demonstrate how traditional office settings compare to the more wide spread application of agile working environments.

Our latest annual debt review provides comprehensive analysis of 2015’s trends and considers how and why 2016 may be different. Our key conclusions are: Last year, new lending doubled, rising to €127 billion based on a record €273 billion of CRE investment. Lending margins were generally stable for bilateral lending and LTV levels stayed low, by historic standards. Despite the rise in new debt issuance, the total value of European CRE debt in 2015 was only slightly higher than in the previous year, at €1.1 trillion, because new lending was offset by the retirement of existing debt. NPL activity was robust. Sales were up 23% in 2015 to €85 billion. Dry powder for loans and distressed assets is high and pressure is rising on European banks which have yet to address long-standing, non-core loan books, meaning the pace of deleveraging will continue. Investors have become more cautious. This change in sentiment is a factor in a slowdown in 2016 investment activity and is likely to affect loan pricing.

•BOTH PRIME HIGH STREET AND SHOPPING CENTRES SEE POSITIVE BUT SLOWING RENTAL GROWTH IN Q2 The CBRE EMEA Prime High Street rent index grew by 1.81%  q-o-q and 6.89 % y-o-y, however there has been a slowing of these growth rates compared to the 2.1% growth we saw in Q1. It’s a similar story with the Prime Shopping Centre index as it grew by 0.36% q-o-q and 2.28% y-o-y in Q2 slower than the 0.65% growth we saw in Q1. •CONSUMER CONFIDENCE STABILISES IN Q2 Consumer confidence has started to recover in Q2 from the downward trend we saw in Q1. In the second quarter of 2016 consumer confidence improved moving from -7.3pts to -5.7pts. Although consumer confidence has improved and is significantly above its long term average, greater uncertainty in the second half of the year may impact consumer confidence going into Q3. •RETAIL INVESTMENT TOTALLED €12.8 BILLION IN Q2 The UK remains the key target for European retail investment, followed by Germany; Europe’s second largest market. Regional centres led the market as assets in core markets are in short supply. The gap between prime and secondary yields remains wide as investors continue to play a risk-adverse strategy.

•CRE investment in Europe totalled €54.0 billion in Q2 2016, slightly up on Q1, though down on the €66.6 billion  recorded in Q2 last year. •Lower levels of investment in Europe’s two largest markets; the UK and Germany, have dampened the European total. •The Irish market saw  €2.3 billion transacted; a record level of activity. The total was boosted by a couple of high value transactions including Ireland’s largest shopping centre, the Blanchardstown Centre. •Of the main sectors offices had the strongest quarter, with €23.7 billion invested. This was a 8.3% increase on Q1 2016, driven by strong performance in the Nordic markets.