The latest report from Savills' Market in Minutes presents the Real Estate Market's first quarter of 2013. The value of investment transactions amounted to 600 million euros, showing a decrease in comparison to that achieved in the same quarter of 2012 which showed a result of 728 million euros. Experts point out, however, the increased number of transactions - from 6 to 15. According to Savills' predictions, the value of investment transactions will exceed 2.5 billion euros by the end of this year, nearly the same level as 2012, when it stood at 2.7 billion euros.
Total investment in the first quarter of 2013 came in lower than the previous year but in fact the number of completed investment deals has risen. Taking this growing investment activity into consideration we have increased our H1 investment volume forecast from 1 billion euro to 1.5 billion euro and expect the total 2013 volume to exceed 2.5 billion euro - says Brian Burgess, Managing Director of Savills, Poland.
However, the value of investment transactions in the commercial, real estate market in the EMEA (Europe, Middle East and Africa) has increased. As per the Cushman & Wakefield database, the transaction value amounted to 32.7 billion euros, an increase of 15.7% in the first quarter of 2013 compared with the same quarter in 2012. When compared with the last quarter of 2012, there has been a decrease of 24.8%, but experts point out that such a trend is normal.
In the early months of this year, there has been a large increase in the activity of investments, which began in the fourth quarter of 2012. However, there has been a slight change in the behavior of investors. Main markets still enjoy great interest and considerable participation in the total volume of turnover, but this also increases the importance of the diversification of investments and the willingness of investors to take risks, such as seeking larger assets for example the best Shopping Malls. The investors are increasingly looking into other regions, offering relevant products and contributing to the increase of investments; for example in Central Europe - said Jan Willem Bastijn, Director of the Capital Markets of the EMEA at Cushman & Wakefield.
In Poland, during the first quarter of 2013, the highest level of transactions came from the Real Estate Ofice sector, which is responsible for 71 percent of overall volume, according to Savills' figures.
Michael Ćwikliński, Director of Savills - Poland Investments, comments - Warsaw is still the main destination office investment however we anticipate increased activity in regional office markets as both domestic and international investors look for alternatives to Warsaw office properties. Although the office sector continues to dominate investment activity the retail sector has accounted for almost 50% of Poland’s investment volume over the last decade and cross-border appetite for shopping centres across the country remains robust.
Savills' experts also advise that there is still a large presence of international buyers in Poland. 29.5 percent of transactions were the purchasers from the US for 28 percent of the country and 25 percent were German in the first quarter.
The situation looks different in EMEA, where The Real Estate Office sector is responsible for 43 percent of transactions in the market. In addition, as reported by Cushman & Wakefield, their share decreased by 4.8 percent from the average level of 49 percent in 2012. There is a lot of activity from foreign investors in the majority of foreign countries.
David Hutchings, Director of The European Studies Department of Cushman & Wakefield, commented on the slightly better availability of debt financing investors who will be expanding horizons in coming months - They take into account the smaller plans, mature markets, as well as emerging markets and those located in a difficult situation, if only the dynamics of supply and demand will have fostered growth and income security. However, macroeconomic risks, and in particular the risk of revenue loss will continue to polarize. In spite of the unstable economic-political situation of the past few months, the feeling within investment markets is positive. In addition, the current interest rate bonds best Real Estate rental contracts for long periods are particularly attractive.
Poland is a leader in Central Europe, with close to 50% of the shares in transactions.
The full version of the report by Savills in the PDF version is shown below