According to Cushman and Wakefield’s (C&W) European Banking Briefing, the global economic crisis has pushed banks’ take-up of office space in Q1 2009 down by -80% against the long term quarterly average with the London, Moscow and Warsaw markets most affected.

C&W expects many banks to increase their real estate sale and leaseback programmes to raise capital over the next 12 months, particularly those which have had significant injections of government capital. Banks including Unicredit, HSBC and BBVA have all recently committed to major European real estate sale and leaseback programmes and C&W expects more to follow in 2009.

As rental values and capital values continue to decline, C&W also expects banks to make savings to their operational costs by renegotiating and re-gearing their leases. Many landlords are increasingly willing to renegotiate on favourable terms to secure tenants rather than risk empty properties.

Further consolidation is also expected within the sector in 2009 which will ultimately lead to a rationalisation of real estate holdings. Despite the merger activity that has already taken place, however, there has been relatively little tenant led space from banks being openly marketed in the main European markets as banks are already using space efficiently and because recent mergers have yet to fully agree their real estate requirements.