Investment level was 41 percent higher than 2013, approaching 2007’s figures
Investment activity in the core Central European markets of Poland, Czech, Slovakia, Hungary and Romania increased significantly in Q4 2014 to €2.9 billion ahead of the €1.8 billion invested in Q3 2014, according to real estate advisory Cushman & Wakefield.
Overall, over €7.3 billion was invested in the core CE markets in 2014, accounting for 41 percent increase on the previous year’s figure of €5.2 billion, and approaching the record 2007 levels of €9.3 billion.
“Central Europe has become an established part of any pan-European investment strategy. Warsaw has been the gateway for this but activity is clearly growing rapidly across all CE countries. The region offers quality assets and robust occupational markets all driven by the fastest growing economies of any European region,” James Chapman, Partner, head of CE Capital Markets at Cushman & Wakefield, said in a press release.
The Czech Republic experienced a 96 percent increase on 2013 volumes with €1.99 billion transacted in 2014.
“For the first time in history, the highest investment volume in the Czech Republic was in industrial real estate. Its overall share of 37 percent is an exceptional result and testifies to the trust that investors have placed in the Czech economy’s positive development. American investors took the lead both in this segment and in general, spending more than €700 million,” said Jiří Fousek, Cushman & Wakefield’s head of capital markets.
There is greater diversity of active investors across Central Europe than at any time since 2007 including established European and US investors as well as Asian and Middle Eastern capital.
Performance across each of the property sectors was up or over the long term average. Offices were the leading sectors with €2.81 billion traded in 2014 (13 percent increase on 2013), followed by retail with €2.32 billion (25 percent on 2013). The industrial market continued its impressive bull run with 470 percent volume growth over the 5-years’ average (€1.77 billion in 2014).
Poland attracted €3.13 billion in 2014, improving slightly on 2013 figure. Romania saw the highest annual increase of 141 percent and achieved €1.07 billion in 2014. The investment volume in Hungary was at €616 million in 2014 (73 percent increase on the year). Slovakia recorded a 116 percent y-o-y increase and reached €504 million in 2014.
|Top 5 Property Transaction in Central Europe in 2014|
|Property||Buyer||Price (€ millions)|
|VGP Portfolio – 11 logistics parks, Czech Republic||PointPark Properties (P3)||523|
|Rondo 1, Poland||Deutsche Asset & Wealth Management||295|
|Acquisition of 12 convenience-type shopping centres in Romania||Auchan||280|
|Poznan City Center, Poland||ECE and Resolution||227|
|Eurovea shopping centre, Slovakia||Private buyer||Confidential|
Cushman & Wakefield forecasts further investment volume growth across all CE markets in 2015. This will be combined with a continued tightening of yields in all sectors, the company said in a press release.