C.Europe property investment tests $8 bln for FY-C&W

Tue Oct 4, 2011 4:56am EDT

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LONDON, Oct 4 (Reuters) - Property investment volumes in central Europe are set to hit 6 billion euros ($8 billion) by end-2011, spurred on by strong investor appetite for assets in the Czech Republic and Poland, property consultancy Cushman & Wakefield said.

The surge in demand has driven down yields for high-quality assets across the region -- those on prime shopping malls have fallen to less than 6 percent -- although most markets have a reasonable level of supply, C&W said.

Data from C&W showed investment volumes for the region stood at 4.61 billion euros in the nine months to Sept. 30, more than double the 1.95 billion recorded for the year-earlier same period, and could reach 6 billion euros by the year's end.

"Transaction activity is back at 2005 levels and fourth quarter 2011 is expected to be strong in Poland, Czech (Republic) and Hungary," said Charles Taylor, managing director of C&W's Budapest office, in the statement.

"That said, we cannot ignore the increasing economic uncertainty which is starting to impact on investor confidence and also the availability of finance, both of which could slow market activity in the closing months of this year."

The company said while the Czech Republic and Poland were investors' top picks for the year to date, respectively attracting 1.9 billion euros and 1.8 billions euros of investment, other markets were beginning to attract interest.

Investors active in the region included CA Immo , Atrium European Real Estate , Unibail Rodamco , Deka Bank and Invesco Ltd, C&W said. In September, Atrium bought a Prague mall for 191 million euros from AFI Europe and Avestus Capital.

On June 1, Austrian property developer Sparkassen Immobilien said it planned to hike its exposure to prime offices and retail assets in emerging Europe over the next five years to drive net asset value growth and profit.

By sector, the data showed investment into retail property totaled 1.9 billion euros year-to-date, against 1.7 billion euros for offices. About 641 million euros was invested in the industrial and logistics property over the same period. ($1 = 0.753 Euros) (Reporting by Brenda Goh)

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