- Asian investors invested over CZK 36 billion in Czech real estate in 2016, comprising more than 36% of the total volume of the commercial investment market.
- Strong demand will continue across all sectors in 2017. CBRE predicts that the volume of investments will once again exceed the level of CZK 90 billion (EUR 3 billion). Investments this year will be dominated by the retail sector.
Prague 18th January 2017 – CBRE, the world leader in commercial real estate services, has released the results of commercial real estate investments for 2016. The investments include real estate projects across all sectors, especially in the office, industrial, retail and hospitality segments. The total investment volume in the real estate sector exceeded CZK 100 billion (EUR 3.7 billion).
The most notable transactions in 2016 were the sale of P3 Logistics Parks, the Park and Florentinum, with 67 transactions being mediated on the Czech market in total. The market was dominated by investments in office properties accounting for 43% of total transacitons, while industrial investment made up 28% and the retail sector constituted only 17% compared to 2015, when it dominated the market. The largest number of transactions in the office sector took place in Prague, at 97%.
Chris Sheils, Head of Investment Properties at CBRE, said:
“Asian investors that are active in the CEE market tend to be focussed on larger transactions, such as dominant properties, portfolios or even by taking an ownership interest in a real estate operating platform itself, such as the recent acquisition of P3 Logistics Parks by GIC, the Singaporean Sovereign Wealth fund.”
Investments by Asian investors in 2016 accounted for 36% of total investment, followed by investors from the Czech Republic (32%), with Germany coming in third (12%).
CBRE predicts continued downward pressure on prime yields in the investment sector; however, this decline will be slower than in previous years. Currently, we monitor more than 50 ongoing transactions on the market with a total investment volume of over EUR 3.3 billion, which could be closed by the end of 2017. We further predict that more than 50% of the total investment in 2017 will be regional.