Huge spike in foreign investment in Danish property

Investors from abroad shelled out 50 billion kroner last year

New figures from the consultancy group Cushman & Wakefield have revealed that foreign investors have taken a great shine to the Danish property market recently.

The data shows that last year alone, investors from abroad acquired Danish property to the tune of 50 billion kroner – 11 times more than just five years ago. Overall, foreign investment accounted for 54 percent of investment in Denmark’s property market last year.

“In 2011 there were practically no foreign investors. Since then, we’ve experienced significant growth and can see foreign capital accounted for over half of the investment in 2017,” Nicholas Thurø, a partner with Cushman & Wakefield, told DR Nyheder.

“We’ve seen falling and lower interest rates coupled with very low trading costs on the Danish market. That fact, combined with the secure Danish economy, makes it a safer bet to invest in the Danish market whilst navigating the crisis.”

READ MORE: Property prices in Copenhagen and Aarhus will fall, bank predicts

Swedes in strong
In total, pension firms, estate funds and investors pumped 92 billion kroner into Danish property last year, an increase of 34 percent compared to 2016.

The biggest investor was Swedish firm Heimstaden, which invested 19 billion kroner in the Danish market, followed by Niam (Sweden – 11.9 billion), Patrizia (Germany – 10.6), ATP (Denmark – 9.9), NREP (Denmark – 8.4), Jeudan (Denmark – 7.9) and Standard Life Aberdeen (Scotland – 7.5).

Blackstone (US) and AB Balder (Sweden) were other heavy foreign investors.

Saturation reached
Copenhagen was a particularly popular arena for foreign investment. Figures show that 71 percent of investment in the Danish capital came from abroad. Aarhus and Odense were also popular investment hubs.

However, Thurø maintains that the market reached its peak during the first quarter of 2018 due to prices being 5-10 percent higher than what prospective buys want to pay.