Morgan Stanley: Real estate transactions recorded in Paris office space were down 9% and in Centre West Paris 8%, implying that the pace of decline is moderating. However, volumes remain low even though they have recovered from lows. On the other hand, vacancies continue to rise and available supply increased in all regions in the quarter. Rental growth was up 6% year-on-year, sustained over previous levels. While remaining positive on the sector, Ana Escalante and Bart Gysens, continue to be concerned about companies with high leverage and asset valuations below book value and see a slower recovery.
They reiterate their Overweight on Icade, Equalweight on Colonial and Underweight on Gecina and Covivio.
