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Savills PLC on Thursday said it performed ahead of previous expectations in 2022 and was well ahead compared to the pre-Covid-19 period.
The London-based, internationally-focused real estate services firm said positive trading performance was despite global real estate markets being ‘increasingly challenged by geopolitical events, macroeconomic issues and policy responses’ since the end of the first quarter in 2022.
It noted 2022 performance being driven by strong trading in its consultancy and property management businesses.
However, it noted a rapid rise in debt costs has hurt its transactional businesses, a ‘significant issue with which commercial investment markets have had to come to terms’.
These challenges will remain significant in the first half of 2023, Savills said.
The prime residential market remained strong in 2022, the company said, offsetting the slowdown in commercial property, but it expects the prime residential market to normalise in 2023 after a post-lockdown boom.
Looking ahead further, while Savills expects the first half of 2023 to be more difficult than a year prior, as inflationary pressures and interest rate hikes still loom, it forecasts improvement in the second half of the year.
It looks optimistically to markets such as in the UK, which Savills claims is ‘recalibrating faster than in the past, and will be helped by the lack of development supply and an overall trend to sustainability’.
Savills also cited the easing of Covid-19 restrictions in China as reason for positivity.
It will release its 2022 annual results on March 16.
Shares in Savills were up 3.4% to 899.50 pence each in London on Thursday morning.
By Greg Rosenvinge, Alliance News reporter
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