Deutsche Hypo ups growth forecasts for 2018

Deutsche Hypo has upped its economic forecasts for 2018 on the back of strong fundamentals in Germany, its CEO Andreas Pohl told REFIRE this month.

‘We have increased our forecast for economic growth in 2018 to 2.2%, up from our initial forecast of 1.6% because the German market is very stable,' he said. ‘Equally, we have increased our forecast for this year to 2%.’

Strong demand for office properties against a backdrop of limited supply is also boosting the market, Pohl said.

‘Next year will be a good year,’ he said. ‘The economy is very strong, interest rates are low and investors have a lot of faith in the German market.’

In the Deutsche Hypo-Index published this month, office sentiment rose for the third consecutive month to 152.7 points, an increase of 0.5%, its highest level since 2008. Logistics didn’t fare so well; sentiment there fell by 4.1% in November to 147 points. Retail also fell by 3.3% to 103.7 points. Despite three months of gains, hotels fell this time, albeit it by only 0.6%, to 134.5 points. The residential climate fell, too, by 0.4% to 161.6 points, although it still ranked top. Overall, sentiment remains good, even if it fell fractionally by 1% to 139.5 points.

The economic climate vis-à-vis property is moving onwards and upwards, despite a dreary autumn and the German government’s coalition talks that are dragging on, rising by 1.7% this month to 317.9 points. This marks a new high in the survey.