€ 957 million for investments since the beginning of the year

New City complex in Warsaw, purchased by Hines
New City complex in Warsaw, purchased by Hines
€ 957 million was invested in the commercial real estate markets in Central Europe in the first quarter of 2013.

The analysts at Cushman & Wakefield inform that since the beginning of 2013 the total value of investment transactions on the real estate markets in Central Europe, that is, in Poland, the Czech Republic, Romania, Slovakia and Hungary, has amounted to € 957 million. This is the growth by 6% in comparison to the average from the last 5 years. However, this result is lower than in the previous quarter when the value amounted to € 1 826 billion.

"In the first quarter the investment activity has increased slightly. Some investors consider the possibility of taking more risk and also take into account more developed and relatively mature markets in Central Europe, where they can rely on not only better capitalization rate and comparatively higher economic growth than in the western countries, but also on higher financial liquidity," said Chalres Taylor, a Partner at Cushman & Wakefield.

In comparison to the first quarter of 2012, a trading volume has decreased from € 818 million to € 465 million in Poland, while it has increased in the Czech Republic and Hungary.

The office real estate market has still been the most attractive for investors, in which the value of investments has amounted to € 646 million. The main transactions included among others the purchase of New City by Hines in Warsaw and the purchase of Green Towers by PZU in Wrocław.

"Investment forecasts for Central Europe give some grounds for optimism, especially due to the high rate of advanced transactions. Investors' demand is still diverse, depends on a particular country and industry as well as refers mainly to the best assets on the liquid markets. We are pleased with the growth of the investors activity on the Czech market, which partially results from reduction in prices of investment products," states Charles Taylor.

Łukasz Lorencki, from Warsaw's Capital Markets Group at Cushman & Wakefield comments, "Despite the decrease of the trading volume in the first quarter we cannot talk about weakening of the investment activity in the Polish real estate market. With almost 50% of shares in transactions we are still the leader in the investment market in Central Europe. The last year's purchase transaction of Złote Tarasy for € 475 million was exceptional, and which significantly increased the value of transactions in that particular period. The office market still is extremely popular among Polish investors and constituted 65% of value of all transactions in the first quarter of 2013. The dynamics of the storage market  are not declining due to 24% of volume. The lower activity has been observed in the commercial market (10% of assets in the general volume). Because of numerous preliminary agreements, which were announced in the last months, the value of investment transactions in the next quarter should remain on the present, very high level. The forecasted economic upturn in the second quarter should favour the increased interest in secondary estates and those located in smaller cities and towns."


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