By Iain Withers
CANNES, France (Reuters) - LaSalle Investment Management is reducing its exposure to offices in Europe and believes between 20% and 30% of office space in the region could be "obsolete", the firm's head of Europe said on Tuesday.
"Is there redundant space in areas where it shouldn't have been in the first place? I think maybe 20 to 30% of office stock is probably obsolete," Philip La Pierre, head of Europe at LaSalle, told Reuters at the MIPIM real estate conference in Cannes.
La Pierre said the commercial real estate market remained "fickle", although there were signs that investors were slowing redemption requests and becoming used to lower prices.
"Everyone has to accept the fact that pricing is down 30 to 40% and they might want to liquidate their position ... Now they're willing to do it. But it takes a year or two psychologically to adapt to the fact that you're making a loss," he said.
Despite the tough conditions, LaSalle is targeting growing its overall property acquisitions in Europe to $2 billion in 2024, up from $1.8 billion last year, and sees growth opportunities in real estate debt, La Pierre said.
LaSalle is an independent part of global property services firm Jones Lang LaSalle.