invested in the CEE property market in 2011
The first two months of the year saw increasing activity on the investment market in Central and Eastern Europe but limitations, such as the availability of good product, is bound to pose an obstacle in the near future, according to international property consultant CB Richard Ellis.
The biggest deal involved the purchase of logistics developer Europolis, a unit of Österreichische Volksbanken, by CA Immobilien Anlagen AG. Although the acquisition was already announced last summer, it was only concluded in January and is seen as a major boost to improving investor sentiment throughout the region’s markets.
The positive mood has spread to other countries as well, with South-Eastern Europe also seeing the return of institutional investors by the end of 2010, a trend that is continuing this year. Croatia, Bulgaria and Romania are all experiencing the upswing. As an example, Europa Capital purchased a retail complex in Plovdiv, a regional city in Bulgaria.
In CEE, Poland has maintained its role as the most appealing market to investors. Here, office transactions were also concluded, even though they were limited in number, and buyer interest remains at a high. In fact, owning to positive developments in its economy, a growing number of prospective investors are seriously considering Poland for 2011. The Czech Republic has seen limited activity in the initial months of they year, but here too, the market is expected to pick up.
Hungary’s office market has seen no transactions to date and even though the situation is improving, interested investors are predominantly focusing on retail projects. CBRE finds that the market is mainly driven by local actors that have an understating of the market and may therefore take advantage of reduced transaction sizes, and the invigoration of the market outside of Budapest.
This article appeared in the BBJ's Office Market special report on April 22, 2011.