Transaction volume increased to €5.5 billion in 2015; brisk start for 2016. The total property transaction volume in 2015 increased to €5.5 billion, which is the second highest volume ever. The volume was boosted by several major portfolio transactions. Domestic funds and investment companies actively increased their portfolios in 2015, while foreign investors accounted for one third of all transactions. 2016 has started briskly in the transactions market, and already by the end of February, the volume has reached some €1.4 billion.
 
The total size of the property investment market increased by 9% in 2015. The total size of the invested property market increased to €54.5 billion at the end of 2015. The growth is a result of both newly developed properties in the investors’ portfolios as well as some major sale-and-leaseback transactions from corporations to investors. Domestic institutions remain the biggest player group in the market, although their share has decreased markedly in recent years and currently stands at some 29%. The decrease is caused by the active implementation of their renewed property investment strategies, whereby the majority of their new investments are targeted abroad. This has also resulted in major restructurings in their domestic portfolios. Domestic funds and non-listed investment companies have increased their portfolios rapidly. Foreign investors account for some 22% of the total market.
 
Residential continues to perform strongly, Helsinki CBD offices outperform all other submarkets. Strong inflow of capital has made residential, together with offices, the biggest sector in the property investment market, with a share of 29% of the total market. Residential has been the best performing sector in the KTI Index for eight consecutive years, and in 2015, total return on residential amounted to 8.9%. In the commercial property market, the strongest international interest is targeted at prime offices in the Helsinki CBD. This has resulted in yield compression, with prime yields currently standing at some 4.7%. In the KTI Index, the market values for Helsinki CBD offices increased markedly, and total return amounted to 11.6% in 2015. In most other submarkets in the Helsinki metropolitan area, the market values of offices continued to decrease, due to the high vacancy rate, which still stands above 13%.
 
Retail property market in the Helsinki metropolitan area is characterised by active new development with almost 190,000 sqm of new retail space under construction, and some major projects just about to be started. Need for new retail space is based on the continuous population growth in the area. New development is mostly concentrated around the station areas of the new rail connections – Ring Rail Line and the western metro line.