The EMEA region recorded below-average property investment transaction volumes of $41.9 bn (EUR 29 bn) in Q1 2011, reflecting continued uncertainty and caution arising from the sovereign debt crisis, according to the latest research by global property adviser CB Richard Ellis. The quarterly transaction average for the region is $51.7 bn.

Raymond Torto, CBRE's Global Chief Economist, commented: 'The German market in particular has seen rapid growth in property investment turnover, perhaps influenced by the fact that its economy has been one of the most robust in the region over the last year; both local and international investors have been active, with the retail sector attracting a high share of investment activity.'

He added: 'The Central and Eastern Europe (CEE) region also stands out, with investors attracted to the higher yields on prime property compared with the main Western European markets. Investors remain very wary of taking short leases or secondary locations, so competition for prime assets in major cities is intense.'

The limited number of active lenders has also hindered growth in investment activity in the EMEA region. The debt capital constraints, together with higher interest rates in the Eurozone, are restraining transaction levels.

Nevertheless, EMEA's sales volume grew 35.4% year-on-year in Q1 2011. Torto added: 'Lenders have not forgotten the legacy of bad debts that remains from the global crisis period. Although some new players have entered the market, their interest is mainly in cherry-picking the best deals and providing senior debt for transactions involving high-quality, core property.'