Post on 16-May-2018
transcript
Table of contents
Cyprus
Greece
Czech Republic
Germany
Italy
Estonia
Latvia
Lithuania
Netherlands
Poland
Romania
Ukraine
Sweden
Switzerland
Serbia
Austria 6
28
Georgia
8
10
12
14
16
18
20
22
24
26
30
32
34
36
38
ACROSS EUROPE
0
10
20
30
40
50
60
Germ
any
Sw
eden
Neth
erla
nds
Italy
Po
lan
d
Au
str
ia
Cze
ch R
epublic
Georg
ia
Lith
uania
Esto
nia
Gre
ece
La
tvia
Cyp
rus
in €
bn
Investment Volume in RE by Country - 2017
Source: NAI Global Network
Across Europe
Across Europe
Note: Yield refers to Grade A office in prime location
Source: NAI EMEA Network
Office Yields in European Cities - 2017
Note: Yield refers to Grade A Warehouse / Logistics ( >5,000m2) in prime location
Source: NAI EMEA Network
Logistics Yields in European Cities - 2017
Note: Yield refers to high street retail in prime location
Source: NAI EMEA Network
Retail Yields in European Cities - 2017
2,80
%
2,85
%
3,10
%
3,15
%
3,20
%
3,25
%
3,50
%
3,50
%
3,60
%
3,90
%
4,00
%
4,00
%
4,15
%
4,80
%
4,85
%
4,90
%
5,30
%
5,42
%
5,50
%
6,00
%
6,25
%
6,50
%
6,50
%
6,75
%
7,00
%
7,25
%
8,00
%
8,50
% 10,0
0%
14,0
0%
0%
2%
4%
6%
8%
10%
12%
14%
16%
Zür
ich
Vie
nna
Gen
eva
Mun
ich
Ber
lin
Ham
burg
Fra
nkfu
rt
Mila
n
Sto
ckho
lm
Dus
seld
orf
Am
ster
dam
Rom
e
Got
henb
urg
Rot
terd
am
Pra
gue
Lim
asso
l
Nic
osia
Ave
rage
War
saw
The
ssal
onik
i
Tal
linn
Kra
ków
Viln
ius
Rig
a
Brn
o
Buc
hare
st
Ath
ens
Bel
grad
e
Tbi
lisi
Kyi
v
3,60
% 4,75
%
4,80
%
4,80
%
4,80
%
4,80
%
5,60
%
5,70
%
5,80
%
6,00
%
6,00
%
6,00
%
6,25
%
6,30
%
6,50
%
6,75
%
6,75
%
7,25
%
7,80
%
8,00
%
8,00
%
8,75
% 10,5
0%
10,5
0% 11,7
5% 13,0
0%
15,0
0%0%
2%
4%
6%
8%
10%
12%
14%
16%
Lim
asso
l
Mun
ich
Fra
nkfu
rt
Ber
lin
Ham
burg
Dus
seld
orf
Am
ster
dam
Nic
osia
Sto
ckho
lm
Pra
gue
Got
henb
urg
Zür
ich
Mila
n
Rot
terd
am
Gen
eva
Rom
e
War
saw
Ave
rage
Tal
linn
Rig
a
Viln
ius
Buc
hare
st
Ath
ens
Bel
grad
e
The
ssal
onik
i
Tbi
lisi
Kyi
v
2,75
%
2,75
%
2,80
%
3,00
%
3,10
%
3,30
%
3,35
%
3,45
%
3,50
%
3,50
%
3,60
%
3,70
%
3,70
%
4,00
%
4,15
% 5,18
%
5,25
%
5,60
%
5,75
%
5,90
%
6,50
%
6,50
%
6,75
%
6,80
%
7,00
%
7,25
%
8,00
% 9,20
%
14,0
0%
0%
2%
4%
6%
8%
10%
12%
14%
16%
Mila
n
Rom
e
Zür
ich
Mun
ich
Gen
eva
Ber
lin
Ham
burg
Dus
seld
orf
Vie
nna
Fra
nkfu
rt
Sto
ckho
lm
Am
ster
dam
Rot
terd
am
Pra
gue
Got
henb
urg
Ave
rage
War
saw
Nic
osia
Kra
ków
Lim
asso
l
Tal
linn
Viln
ius
The
ssal
onik
i
Rig
a
Ath
ens
Buc
hare
st
Bel
grad
e
Tbi
lisi
Kyi
v
€324
€148
€203
€264
€162
€468
€355
€426
€312
€318
€510
€400
€192
€198
€198
€350
€200
€282
€174
€222
€670
€330
€656
€656
€305
€192
€84
€192
€240
Vienna
Nicosia
Limassol
Prague
Brno
Frankfurt
Berlin
Munich
Hamburg
Dusseldorf
Milan
Rome
Riga
Tallinn
Vilnius
Amsterdam
Rotterdam
Warsaw
Kraków
Bucharest
Stockholm
Gothenburg
Geneva
Zürich
Kyiv
Athens
Thessaloniki
Belgrade
Tbilisi
Office Rent (€/m2/annum) in European Cities - 2017
Note: Rent refers to Grade A office in prime location
Source: NAI EMEA Network
Major Transactions 2016 - 2017
Source: OECD Data
OverviewNew investment volume record in Q1 2017 with around € 2.4 bn
invested in Austrian commercial real estates. Prime yields for office
properties in Vienna fell to 3.95% in Q1 2017 as a result of high
demand. Especially high investment activity from German investors
within the Austrian real estate market. Offices was the most popular
asset class with around 60% of the investment volume in Q1 2017.
Rental capacity in Q1 2017 with 87,000m² was about 30% lower than in
Q1 2016. Completion volume of around 34,000m² in Q1 2017
significantly higher than in Q1 2016. Modern office real estate stock
(class A and B) amounts to approx. 5.63 mn m². Rents in good office
locations rose by about 1.5% in Q1 2017. In 2015 and 2016, the
Austrian retail market recorded some 69 international retail brands and
the trend definitely continues. Especially Vienna´s prime locations in the
city centre are high in demand due to the growing numbers of tourists.
Very big office cluster projects in Vienna will be finished in 2017 and
2018. New acquisitions of shopping centres and specialist market
centres are increasingly focusing on peripheral locations. Top leasing in
shopping centres increased by around 4% in Q1 2017 to around €
120/m²/month.
Investment Volume in the Austrian Real Estate Market
Source: NAI Austria
Source: NAI Austria
Opportunities In general, a stable economic market environment and positive mood
among tenants dominates the office and investment market.
Nowadays, start-ups are increasingly using campus solutions, which
offer employees an attractive work-life balance and are thus intended
to bind specialists to the employer in a sustainable manner. Another
trend are big office clusters in Vienna, which will be completed in 2017
and 2018. Austria will remain an attractive target market for
international retail brands, especially the city centres of Vienna and
Salzburg where tourism booms.
0 0,5 1 1,5 2 2,5 3 3,5 4 4,5
2010
2011
2012
2013
2014
2015
2016
2017F
in bn €
Contact Details
Martin Hirl
Director
martin.h@nai-austria.com
NAI Austria
Mariahilfer Straße 142, 1150 Vienna
+43 660 188 8809
www.naiglobal.com
Country Profile
Population (mn) 8.5
Capital city Vienna
Currency Euro (€)
Country Macroeconomic Profile (2016)
GDP $ 438 bn
GDP growth 1.61%
Unemployment rate 6.00%
Inflation 0.89%
PeriodProperty
TypeLocation
Size
(m2)Vendor Buyer
Price
(in mn)
Q2 2016 Office Building IZD Tower 64,500 Signa n/a confidential
Q1 2016 Office Building
Aqua Portfolio
(Solaris | Florido
Tower)
49,800Union
InvestmentAmundi confidential
Q4 2016 Retail UNO Shopping 47,000Bank Austria
Real InvestPrivate Investors confidential
Q1 2016 Retail Fischapark 42,800 SESAllianz Real
Estate confidential
Q2 2016Logistics/Indust
ry
Aviva Logistics
portfolio49,000
Aviva
Investors
Tristan Capital
Partnersconfidential
Q1 2017 Retail ZIB Salzburg 16,650 Immofinanz Private Investors confidential
Q3 2017 Office Building The Icon 80,000 Signa Allianz Real
Estateconfidential
Q3 2017 Office Building DC Tower 74,500 WED Deka confidential
6
Source: NAI Austria
Grade A Office (@ prime location) High Street Retail (@ prime location)
Source: NAI Austria
Rental capacities by the end of 2017 will be approx. 190,000 m² and the completion
volume of around 34,000 m² was significantly higher than in 2016. There will be about
150,000 m² more office space in 2017, of which 92,000 m² (61%) are already pre-let or
owner-used. The prime rent is stable with €25.75/m² and the average rent with
€13.75/m². The volume of transactions in Q1 2017 amounts to €2.3 billion. For the full
year, the forecast for the sale of commercial real estate would increase to €3.2 bn. The
highest yield is 3.9%. From autumn 2017 the range of new, high quality office space
will be able to satisfy the high demand of the market. Thus, the gap between demand
and supply will gradually subside and the pressure on rental prices will relax.
Vienna has retained its status as an attractive retail market by European standards.
This standing is based on strong purchasing power, which equals €22,000 per capita
and is increasing slightly but steadily. Vienna is a focal point of expansion for 15% of
all international retailers. Retail in the prime segment continues to benefit from the
outstanding development of tourism. The strong demand represents an advantage for
prime locations in the city centre and the largest shopping centres with the highest
visitor frequency. Rents are stable in these so-called A locations, reaching from
€120/m² up to €400/m² and up to €125/m² in the top shopping centres.
0%
1%
2%
3%
4%
5%
€ -
€ 1.000
€ 2.000
€ 3.000
€ 4.000
€ 5.000
€ 6.000
2010 2011 2012 2013 2014 2015 2016 2017E 2018F
Yield
Ren
t (in
€/m
2 /an
num
)
Vienna Rent Vienna Yield
0%
1%
2%
3%
4%
5%
6%
7%
8%
€ -
€ 50
€ 100
€ 150
€ 200
€ 250
€ 300
€ 350
2010 2011 2012 2013 2014 2015 2016 2017E 2018F
Yield / V
acancy Rate
Ren
t (in
€/m
2 /an
num
)
Vienna Rent Vienna Yield Vienna Vacancy Rate
7
Investment Volume in the Cypriot Real Estate Market
Source: NAI Cyprus
Opportunities Overseas investors are increasingly interested in acquiring Grade A office buildings
in key locations to be rented to AAA tenants. On the other hand, Cypriot investors
traditionally prefer acquiring properties mainly for own use even if recently many of
them had to deleverage and ‘sell’ their own assets to the Banks (deleveraging via
D2A swaps).
Country Profile
Population (mn) 8.48
Capital city Nicosia
Currency Euro (€)
Country Macroeconomic Profile (2016)
GDP $19.8bn
GDP growth 2.8%
Unemployment rate 13.2%
Inflation -1.4%
Sources: CyStat, Eurostat and World Bank
Contact Details
George Mountis
CEO
gmountis@naicyprus.com
NAI Cyprus
4th Floor, Georgiou Griva Digeni 36,
1066 Nicosia, Cyprus
+35 722 000 090
www.naicyprus.gr
OverviewThe Real Estate and Construction sector has been showing positive signs of
growth in 2017, restoring optimism to industry professionals. Following a constant
decline over the past six years, market prices are stabilising. In 2016, a significant
amount of companies proceeded to downsizing or even went out of business,
drastically effecting demand and rent prices in areas such as Nicosia and
Limassol. Following a reduction and stabilisation in capital values and rental prices,
investment yields are stabilising at low levels, a strong indication of opportunities
for re-pricing of capital values, mostly in secondary location properties. Investment
yields in the Cypriot commercial market for Q4 2016 in Nicosia were at 5.8% for
retail properties and 5.3% for offices, while in Limassol they were 5.6%, and 4.6%
respectively.
0 50 100 150 200 250
2010
2011
2012
2013
2014
2015
2016
2017F
in mn €
8
Source: NAI CyprusSource: NAI Cyprus
Grade A Office (@ prime location) Grade A Warehouse / Logistics
( >5,000m2 @ prime location)High Street Retail (@ prime location)
Source: NAI Cyprus
Office Market Values were increased in almost all cities and
asset classes in Q4 2016 compared with Q4 2015. Across
Cyprus, offices market values increased by 4.7%. In Nicosia
by 5.65%, in Limassol by 11.04%, in Pafos by 1.78% and in
Famagusta by 2.58%. Larnaca was the only city were prices
did not increase, but remained stable. Grade A seafront/ sea
view office spaces for 2016, were sold for €9.000 per sqm,
while same type offices in secondary locations were sold for
€4.500 per sqm.
Cyprus is making a name as a key regional transport hub. In
2014, around 7.84 million metric tonnes of cargo passed through
Cypriot ports and terminals, representing an increase of 12% on
the previous year. Across Cyprus, rental values increased by
3.5% from Q4 2015 to Q4 2016. At the Q4 of 2016 average gross
yields stood at 4.4%. The parallel reduction and/or stabilisation in
capital values and rents is keeping investment yields relatively
stable and at low levels (compared to yields overseas). This
suggests that there is still room for some re-pricing of capital
values to take place.
Following a constant decline over the past six years, market
prices are stabilising. In 2016, a significant amount of
companies proceeded to downsizing or even went out of
business, drastically effecting demand and rent prices in areas
such as Nicosia and Limassol. Following a reduction and
stabilisation in capital values and rental prices, investment
yields are stabilising at low levels, a strong indication of
opportunities for re-pricing of capital values, mostly in secondary
location properties. Investment yields in the Cypriot retail market
for Q4 2016 in Nicosia were at 5.8%, while in Limassol they
were 5.6%.
0%
1%
2%
3%
4%
5%
6%
7%
€ -
€ 50
€ 100
€ 150
€ 200
€ 250
2010 2011 2012 2013 2014 2015 2016 2017E 2018F
Yield
Ren
t (in
€/m
2 /an
num
)
Nicosia Rent Limassol Rent Nicosia Yield Limassol Yield
0%
1%
2%
3%
4%
5%
6%
7%
€ -
€ 10
€ 20
€ 30
€ 40
€ 50
€ 60
€ 70
2010 2011 2012 2013 2014 2015 2016 2017E 2018F
Yield
Ren
t (in
€/m
2 /an
num
)
Nicosia Rent Limassol Rent Nicosia Yield Limassol Yield
0%
1%
2%
3%
4%
5%
6%
7%
8%
€ -
€ 20
€ 40
€ 60
€ 80
€ 100
€ 120
€ 140
€ 160
€ 180
2010 2011 2012 2013 2014 2015 2016 2017E 2018F
Yield
Ren
t (in
€/m
2 /an
num
)
Nicosia Rent Limassol Rent Nicosia Yield Limassol Yield
9
Major Transactions 2016 - 2017
Source: OECD Data
OverviewStrong stable demand across all investment sectors is expected to
continue throughout the year and the total transaction volume in 2017 is
on the way to exceed its previous year's record figures. Czech Republic
proves as attractive for investors as it receives over 40% of the total
real estate investment in CEE region in the first half of 2017. Most of
the industrial supply is not available open market, as majority of the
deals are made as BTO/BTS. Hospitality business currently lives its
renaissance and offers some interesting investment opportunities.
Finally, Czech office sector is having best year in recorded history with
most demand driven by expansions of existing businesses across
sectors, growing SSCs as well as local IT sector.
Investment Volume in the Czech Real Estate Market
Source: Prochazka & Partners
Source: Prochazka & Partners
Opportunities Positive macroeconomic outlook will drive the investor demand for A-
class office buildings, that shall be partly satisfied by increased
construction, which is expected in the following years. Retail market is
slowly becoming mature, as no major new construction is expected and
the prime offer is limited.
PeriodProperty
TypeLocation
Size
(m2)Vendor Buyer
Price
(in mn)
Q3 2016 Office Prague 49,000PPF Real Estate
HoldingREICO € 180
Q3 2016 Retail Liberec 47,000 Tesco Rockcastle € 80
Q3 2016 Retail/Office Prague 62,000 GTC/Lighthouse Wood & Co € 115
Q4 2016 Office Prague 30,000Erste Group
ImmorentRSJ € 122
Q4 2016 Office Prague 116,000 Starwood Capital Deka € 360
Q4 2016 Industrial Various portfolioTPG/Ivanhoe
CambridgeGIC Real Estate € 761
Q4 2016 Office Prague 56,500Penta
InvestmentsCEFC € 283
Q1 2017 Retail Brno 85,000ECE &
Rockspring
Deutsche
EuroShop€ 374
Q1 2017 Retail Prague 63,500 TescoVGV Property
Investment€ 225
Q2 2017 Office Prague 16,500Walton Street
Capital
Aventicum
Capital€ 170
Q2 2017 Office Prague 36,000CEE Property
DevelopmentPortland Trust € 65
Q2 2017 Office Prague 19,300 Invesco Caerus € 62
Q2 2017 Office Prague 19,200 IAD InvestmentsLaSalle
Investment€ 57
Q2 2017 Office Prague 14,500Skanska
PropertyTriuva € 50
Country Profile
Population (mn) 10.5
Capital city Prague
Currency Czech koruna (CZK)
Country Macroeconomic Profile (2016)
GDP $ 371 bn
GDP growth 2.33%
Unemployment rate 4.00%
Inflation 0.68%
Contact Details
Radek Prochazka
Managing Partner
radek.prochazka@prochazkapartners.cz
Prochazka & Partners
Václavské náměstí 841/3, 110 00 Prague
1, CZE
+420 222 242 342
www.prochazkapartners.com
0 0,5 1 1,5 2 2,5 3 3,5 4
2010
2011
2012
2013
2014
2015
2016
2017F
in bn €
10
Source: Prochazka & Partners
Grade A Office (@ prime location) Grade A Warehouse / Logistics
( >5,000m2 @ prime location) High Street Retail (@ prime location)
After a year of unprecedented low level of new commercial real
estate development, more than 140,000 m2 of new office space
is expected to be delivered to the (Prague) market in 2017.
Many firms, encouraged by strong and stable economic growth,
plan considerable expansions, which shows as relocations
represent 70-80% of total take-up. As the vacancy rate
(Prague) further declines to an all-time low 8.60%, headline
rents are expected to remain rather stable or slightly increase in
prime locations.
Logistics vacancy rates have fallen in the past years, driven by
strong occupier demand, reaching one of the lowest figures
ever. Most of the newly delivered warehouse space have been
already leased by the time of its completion, however the
speculative development increased slightly and represents
roughly a third of the total. Four major developers control almost
two thirds of the total stock, which makes the current market
very concentrated.
Czech Republic (Prague) lately became an attractive
destination for a number of major retailers, making the interest
strong while the high street space is limited. That creates
pressure on prime high street rents that have reached more
than €200 per m2 and are likely to maintain this path of slight
growth in the foreseeable future.
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
20%
€ -
€ 50
€ 100
€ 150
€ 200
€ 250
€ 300
2010 2011 2012 2013 2014 2015 2016 2017E
Yield / V
acancy Rate
Ren
t (in
€/m
2 /an
num
)
Prague Rent Brno Rent Prague Yield
Brno Yield Prague Vacancy Rate Brno Vacancy Rate
0%
1%
2%
3%
4%
5%
6%
7%
8%
9%
€ 42
€ 44
€ 46
€ 48
€ 50
€ 52
€ 54
2014 2015 2016 2017E
Yield / V
acancy Rate
Ren
t (in
€/m
2 /an
num
)
Prague Rent Prague Yield Prague Vacancy Rate
Source: Prochazka & Partners
0%
1%
2%
3%
4%
5%
6%
€ 1.900
€ 2.000
€ 2.100
€ 2.200
€ 2.300
€ 2.400
€ 2.500
€ 2.600
2013 2014 2015 2016 2017E
Yield
Ren
t (in
€/m
2 /an
num
)
Prague Rent Prague Yield
Source: Prochazka & Partners
11
Major Transactions 2016 - 2017
Source: OECD Data
OverviewDuring 2016 real estate investment dynamics have been somewhat
lower compared to record high 2015 investment transaction volumes,
but investor’s interest towards Estonian investment market maintains to
be continuously high. Investment activity in 2016 and beginning of 2017
was dominated by office along with retail sectors. Availability of capital,
attractive price of financing, entrance of new Western and Eastern
investors to Estonian real estate market along with new local players
will result in further investment volume growth. Most active are local
and foreign funds, as well as local and foreign private investors.
Investors interest combined with so far quite balanced demand/supply
proportion facilitated activities in new commercial space development,
especially in office and retail sectors. There is mainly speculative
constructions observed with an aim to attract tenants during
development phase. We estimate that the increasing speculative
supply will cause pressure to vacancies and rental rates during next
couple of years. Prime yield compression continues, 15 - 30 bps was
observed during 2016, yet maintaining favorable levels compared to
Scandinavian and Western European yields.
Investment Volume in the Estonian Real Estate Market
Source: NAI Baltics
Source: NAI Baltics
Opportunities Due to high liquidity investors’ interest towards well-performing
commercial real estate properties will remain continuously high. Prime
yields are between 6.3%-7.3% with even lower sellers expectations.
Retail and office sectors will unchangeably dominate, however more
favorable yields in warehouse/logistics segment might facilitate
investment flow in this field.
Country Profile
Population (mn) 1.3
Capital city Tallinn
Currency Euro (€)
Country Macroeconomic Profile (2016)
GDP $ 38 bn
GDP growth 1.72%
Unemployment rate 6.80%
Inflation 0.15%
Contact Details
Valdis Ligers, LLB, MRICS
Principal
valdis.ligers@naibaltics.com
NAI Baltics
95 Brivibas Str., Riga, Latvia
+37129473300
www.naibaltics.com/
0 50 100 150 200 250 300 350 400 450 500
2010
2011
2012
2013
2014
2015
2016
2017F
in mn €Period
Property
TypeLocation Size (m2) Vendor Buyer
Price
(in mn)
Q1 2016 Office Baltic countries 84,000 Geneba Laurus € 87.0
Q2 2017 Logistics Tallinn 77,000 VGP East Capital € 54.0
Q1 2016 Retail Tallinn 23,800Partners
GroupEast Capital € 30.9
Q1 2016 Retail Tallinn 13,500Mustamae
centreEast Capital € 27.5
Q1 2016 Retail Tallinn 9,450 Citycon EfTEN € 24.0
Q2 2017 Retail Narva 9,000 EfTEN Corum € 16.7
12
Source: NAI BalticsSource: NAI Baltics
Grade A Office (@ prime location) Grade A Warehouse / Logistics
( >5,000m2 @ prime location)High Street Retail (@ prime location)
Source: NAI Baltics
Positive previous year’s trend in absorption of newly erected
office buildings combined with yet upward rent rate tendency
encouraged developers starting new office developments even
with non-existent pre-lease. It is expected that new space
entering the market will exceed more than twice the space
launched during 2014/2015, enlarging modern office stock by
another 20% by the end of 2017, accounting to 670k m2 in
total. Take-up activity is mostly driven by information and
communication sectors, followed by the professional, scientific
and technical service sectors. High demand for small office
premises in CBD is still unsatisfied despite notable office
development pace.
Warehouse and industrial property market continues to remain
active in terms of new developments and high demand for
modern quality space. Total modern industrial premises
constitutes 265k m2. Market managed to mostly absorb the
increasing new supply, nevertheless, huge space developed
resulted in slight overall vacancy growth reaching 5.5% in H1-
2017, compared to 5% last year. Demand was mainly driven by
manufacturing companies with about 40% of total take-up
volume, followed by wholesale and retail companies. There is
shortage of medium class warehouse/logistics premises
observed that would be affordable for smaller tenants.
Estonian retail property market is benefiting from growing
household consumption, increasing wages and positive
consumer confidence. Retail is the most active real estate
sector - for several years in a row major retail chains have
opened new stores and supermarkets, expanded and
renovated existing stock. Three more large - scale shopping
centers are going to be opened in coming years adding to the
market 150k m2. Competition between shopping centers will
cause some redistribution of the market, may put downward
pressure on rent rates and cause adverse effect on vacancies.
0%
5%
10%
15%
20%
25%
€ 170
€ 175
€ 180
€ 185
€ 190
€ 195
€ 200
2010 2011 2012 2013 2014 2015 2016 2017E 2018F
Yield / V
acancy Rate
Ren
t (in
€/m
2 /an
num
)
Tallinn Rent Tallinn Yield Tallinn Vacancy Rate
0%
5%
10%
15%
20%
25%
€ 51
€ 52
€ 53
€ 54
€ 55
€ 56
€ 57
€ 58
€ 59
€ 60
€ 61
2010 2011 2012 2013 2014 2015 2016 2017E 2018F
Yield / V
acancy Rate
Ren
t (in
€/m
2 /an
num
)
Tallinn Rent Tallinn Yield Tallinn Vacancy Rate
0%
1%
2%
3%
4%
5%
6%
7%
8%
9%
10%
€ -
€ 50
€ 100
€ 150
€ 200
€ 250
€ 300
€ 350
€ 400
2010 2011 2012 2013 2014 2015 2016 2017E 2018F
Yield / V
acancy Rate
Ren
t (in
€/m
2 /an
num
)
Tallinn Rent Tallinn Yield Tallinn Vacancy Rate
13
Major Transactions 2016 - 2017
Source: GeoStat
OverviewThere have been no notable transactions during 2017 mainly
privatizations of soviet era office buildings and land for development
such as the Tbilisi Balneology Resort with 10,500 m² GFA on 10,500 m²
of land in the historic city center to MEIDAN Group and one bigger
private transaction the sale of the former hotel Saqaartelo with 8,500 m²
GFA in the center of Tbilisi to Arabela Invest Group.
Investment Volume in the Georgian Real Estate Market
Source: NAI REA Caucasus
Opportunities Feasible investment or rather development opportunities exist in all
segments but especially for hotels throughout Georgia and residential
second homes for rent in Tbilisi and on the Black Sea cost. Georgia’s
tourism industry has for the last years been growing continuously,
international arrivals in 2017 are up 30%. Georgia’s tourism strategy
2025 seeks to increase the revenues received from international tourism
to $5.5 bn per year. The government is supporting tourism, it has
invested heavily and continues to do so in developing Georgia’s ski
regions, has now started focusing on the countries potential for spa
tourism and has initiated a program offering financial support for hotel
developments in select areas.
PeriodProperty
TypeLocation
Size
(m2)Vendor Buyer
Price
(in mn)
Q2 2016 Land Tbilisi Suburb 290,000 STATE
Georgian
Coinvestment
Fund
€ 2.66
Q2 2016Pushkin street
5/7
Tbilisi
Freedom
Square
2, 500 STATE LLC Globalfarm € 4.50
Q4 2016Former- Post
BuildingTbilisi Old City 4,700 STATE LLC telegraph € 2.11
Q1 2017 Former- Hotel Tbilisi Center 8,900LLC
Saqartvelo
Arabela Invest
Groupn/a
Q1 2017Balneoloy
ResortTbilisi Old City 10,000
LLC Balneo
TbilisiMeidan Group n/a
Q2 2017 Land Tbilisi Old City 1,700 LLC CI LLC Evo € 2.00
Country Profile
Population (mn) 3.72
Capital city Tbilisi
Currency Lari (GEL)
Country Macroeconomic Profile (2016)
GDP $ 3.75 bn
GDP growth 2.60%
Unemployment rate 11.80%
Inflation 5.70%
Contact Details
Thomas Foehrer
Managing Partner
thomas.foehrer@rea-caucasus.com
NAI REA Caucasus LLC
5 Marjanishvili Street, Office 403
Tbilisi, Georgia 0102
+995 32 2180901
www.rea-caucasus.com/
0 100 200 300 400 500 600
2010
2011
2012
2013
2014
2015
2016F
2017F
in mn €
Source: NAI REA Caucasus
14
Grade A Office (@ prime location) Grade A Warehouse / Logistics
( >5,000m2 @ prime location)High Street Retail (@ prime location)
Tbilisi A class office market due to past years oversupply is
tenant driven and price sensitive, rents for the last 3 years have
remained stable. Prime rents are slowly increasing. Demand is
slowly growing and vacancy decreasing. So far developments
have mainly been based on tenant orders or been pre-let, thus
the 12,000 m² of new supply in 2016 was absorbed by market.
Changes in the market are expected late 2017 when 25,000 m²
of speculative high-quality offices in prime locations Axis
Towers and King David's will enter the market.
Warehouse space in Tbilisi is mainly owner occupied and except
the Gebrüder Weiss 10,000 m² warehouse established in 2013
and the Hualing 150,000 m² trading center not of international
standards. McDonald’s Georgia opened a 3,300 m² logistics
center in Tbilisi serving its restaurants in the South Caucasus.
Georgia is promoting investments in warehouses. Georgia
serves as an entry gate for the resource rich Central Asian
landlocked countries and is investing in a new deep see port and
in 2018 the upgrade of the China, Central Asia, Caucasus route
completes.
Tbilisi dominates the Georgian retail market with a share of
above 80%. High street retail occupying ground floors of
residential buildings is well developed.
Supply of modern shopping centers still remains far behind CEE
and most notable international type malls are Tbilisi Mall 70,000
m², opened in 2012 and East Point 65,000 m², opened in 2015,
both located at the outskirts of the city. In late 2017 on Tbilisi’s
main avenue Galleria Tbilisi a 22,000 m² mall will be opened.
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
€ 190
€ 200
€ 210
€ 220
€ 230
€ 240
€ 250
€ 260
2010 2011 2012 2013 2014 2015 2016 2017E 2018F
Yield / V
acancy Rate
Ren
t (in
€/m
2 /an
num
)
Tbilisi Rent Tbilisi Yield Tbilisi Vacancy rate
Source: NAI REA Caucasus
0%
2%
4%
6%
8%
10%
12%
14%
€ 40
€ 42
€ 44
€ 46
€ 48
€ 50
€ 52
2012 2013 2014 2015 2016 2017E 2018F
Yield / V
acancy Rate
Ren
t (in
€/m
2 /an
num
)
Tbilisi Rent Tbilisi Yield Tbilisi Vacancy rate
Source: NAI REA Caucasus
0%
5%
10%
15%
20%
25%
30%
€ -
€ 100
€ 200
€ 300
€ 400
€ 500
€ 600
2010 2011 2012 2013 2014 2015 2016 2017E 2018F
Yield / V
acancy Rate
Ren
t (in
€/m
2 /an
num
)
Tbilisi Rent Tbilisi Yield Tbilisi Vacancy rate
Source: NAI REA Caucasus
15
Major Transactions H1 2017
Source: OECD Data
OverviewFollowing a record start to 2017, the German investment market for
commercial real estate continued to perform strongly in the second quarter of
the year. In the months from April to June 2017, a further €13.10 bn was
invested in the German market. This is a third more than in the same quarter
of the previous year. The total transaction volume for the first six months
amounted to €25.58 bn, which is 41.5% above the first six months of 2016.
Portfolio transactions thereby increased disproportionately, and were
responsible for sales of €9.64 bn in the first six months of 2017. This not only
represents 37.7% of the total volume, but was also almost double the
investment level compared to the previous year. The sale of the European
logistics platform Logicor to Chinese state fund China Investment Corporation
(CIC) contributed substantially to this development. The German share has
an estimated value of €2 bn. Individual transactions increased year-on-year
by 22.0% to a transaction volume of €15.93 bn. Office properties remained
the dominant asset class with €11.86 bn or a 46.4% market share. Retail
properties were in second place with €6.06 bn (23.7% share). Logistics
properties achieved the strongest growth of 154.0%. The absolute volume of
this asset class reached €5.49 bn, and already exceeded all previous annual
volumes after only the first six months of 2017.
Investment Volume in the German Real Estate Market
So
urc
e: N
AI a
pollo
Source: NAI apollo
Opportunities Following the spectacular start to the year by the German
commercial property investment market, activity is expected to
remain at a high level during the rest of the year. In addition to the
continuing strong interest from investors in the property asset
class, portfolios and large properties that are currently in the
marketing phase will influence further investment activity.
Furthermore, the second half of 2017 is also likely to see a large
number of transactions. NAI apollo real estate therefore expects
the transaction volume for the commercial property investment
market to again exceed €50 billion in 2017 as a whole.
Country Profile
Population (mn) 80.9
Capital city Berlin
Currency Euro (€)
Country Macroeconomic Profile (2016)
GDP $ 4,028 bn
GDP growth 1.78%
Unemployment rate 4.10%
Inflation 0.48%
Contact Details
Andres Krone
CEO
andreas.krone@nai-apollo.de
apollo real estate GmbH & Co. KG
Schillerstrasse 20
60313 Frankfurt am Main
+49 69 9705050
www.nai-apollo.de
0 10 20 30 40 50 60
2010
2011
2012
2013
2014
2015
2016
2017F
in bn €
Period Property Type Location Size (m2) Vendor BuyerPrice
(in mn)
H1 2017Logicor-Portfolio
(German-part) (Logistics)Germany 2,300,000
Blackstone /
Logicor CIC € 2,000
H1 2017Hansteen-Portfolio
(German-part) (Logistics)Germany 1,560,000 Hansteen Blackstone / M7 € 974
H1 2017 Retailportfolio Germany 290,000 CORESTATE BVK € 687
H1 2017Gramercy-Portfolio
(German-part) (Logistics)Germany 661,000 Gramercy AXA IM € 465
H1 2017Geneba (German-part)
(Logistics)Germany 486,000
Catalyst
Capital
Frasers
Centrepoint
(FCL)
€ 430
H1 2017 Office building "T8" Frankfurt 29,600 Credit Suisse
Mirae Asset
Global
Investments
€ 300
H1 2017Ikea-Portfolio (German-
part) (Retail)Germany 638,300 Ikea Pradera € 295
H1 2017Symphonie-Portfolio
(Office)Germany 60,625
Orion Capital
ManagersPatrizia € 280
H1 2017Office building "Kap
West"Munich 42,000 OFB
Allianz Real
Estate€ 242 16
Grade A Office (@ prime location) Grade A Warehouse / Logistics
( >5,000m2 @ prime location)High Street Retail (@ prime location)
In H1 2017 the take-up of office space (through letting and
owner-occupiers) in the top five German real estate markets
totaled 1,571,300 m2 (+6.1% compared to the previous year).
The highest take-up was achieved in Munich with 411,000 m2
(+6.5%), followed by Berlin (395,000 m2; -4.1%), Hamburg
(297,000 m2; +24.3%), Frankfurt am Main (248,300 m2;
+12.6%) and Dusseldorf (220,000 m2; -1.3%). Although take-up
in the top five market is rising and the vacancy rates are sinking
the prime rents kept in four of five markets stable compared to
the end of 2016. Berlin achieved an increase of 5.0% compared
to Q4 2016.
In H1 2017 approx. 1,042,000 m2 warehouse and logistics space
were let or occupied by owners in the top five markets (Berlin,
Hamburg, Munich, Frankfurt am Main and Dusseldorf). Compared
to the previous year this is an slight increase of 3.6%. Highest
take-up was achieved in Frankfurt (369,000 m2; -6.7% y-o-y),
followed by Berlin (255,000 m2; +53.6%), Hamburg (235,000 m2; -
6.7%), Munich (125,000 m2; +27.6%) and Dusseldorf (58,000 m2;
-32.6%). Compared to the end of 2016 the prime rents in Q2 2017
kept stable in the top five markets.
The top five markets, which are also the most sought-after
shopping locations, registered in 2017 an increase of the
purchasing power between 1.1% and 2.0% in 2017. Berlin is
characterised by the high increase of 2.0% (€20,390 per
inhabitant) while Munich has the highest total of €30,136 per
inhabitant. In comparison to the end of 2016 the prime rents in Q2
2017 are unchanged besides Berlin. In the German capital the
retail prime rent decreased by 2.9%.
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
€ -
€ 50
€ 100
€ 150
€ 200
€ 250
€ 300
€ 350
€ 400
€ 450
€ 500
2010 2011 2012 2013 2014 2015 2016 2017E
Yield / V
acancy Rate
Ren
t (in
€/m
2 /an
num
)
Frankfurt Rent Berlin Rent Munich Rent
Hamburg Rent Dusseldorf Rent Frankfurt Yield
Berlin Yield Munich Yield Hamburg Yield
Dusseldorf Yield Frankfurt Vacancy Rate Berlin Vacancy Rate
Munich Vacancy Rate Hamburg Vacancy Rate Dusseldorf Vacancy Rate
0%
1%
2%
3%
4%
5%
6%
7%
8%
€ -
€ 20
€ 40
€ 60
€ 80
€ 100
€ 120
2010 2011 2012 2013 2014 2015 2016 2017E
Yield
Ren
t (in
€/m
2 /an
num
)
Frankfurt Rent Berlin Rent Munich Rent Hamburg Rent Dusseldorf Rent
Frankfurt Yield Berlin Yield Munich Yield Hamburg Yield Dusseldorf Yield
0%
1%
2%
3%
4%
5%
€ -
€ 500
€ 1.000
€ 1.500
€ 2.000
€ 2.500
€ 3.000
€ 3.500
€ 4.000
€ 4.500
€ 5.000
2010 2011 2012 2013 2014 2015 2016 2017E
Yield
Ren
t (in
€/m
2 /an
num
)
Frankfurt Rent Berlin Rent Munich Rent Hamburg Rent Dusseldorf Rent
Frankfurt Yield Berlin Yield Munich Yield Hamburg Yield Dusseldorf Yield
Source: NAI apolloSource: NAI apolloSource: NAI apollo
17
Country Profile
Population (mn) 11.1
Capital city Athens
Currency Euro (€)
Country Macroeconomic Profile (2016)
GDP $ 287 mn
GDP growth -0.05%
Unemployment rate 23.50%
Inflation -0.83%
Contact Details
Thomas Ziogas
Senior Partner
t.ziogas@naihellas.gr
NAI Hellas / AVENT S.A.
4 Nikitara Str & Psaron
Halandri, 15232, Athens
+30 210 68 11 760
www.nai-hellas.gr
Major Transactions 2016 - 2017
PeriodProperty
TypeLocation
Size
(m2)Vendor Buyer
Price
(in mn)
Q3 2016Hypermarket
Portfolion/a
100,000
Sklavenitis
Group
Grivalia Properties
REIC€ 60.0
Q4 2016 5* Hotel Rhodes 308 rooms Landa Hotels London & Regional € 30.5
Q4 2016 5* Hotel Athens 506 roomsIonian Hotel
Enterprises
TEMES - D-MARINE
Investments Holding
BV
€ 145.9
Q1 2017 Office Building Glyfada, Athens2,719
n/aInternational
Intercontinental REIC€ 3.4
Q1 2017 Office Building Kifissia, Athens1,302
n/a Trastor REIC € 2.5
Q1 2017 Office Building Athens2,574
n/aInternational
Intercontinental REIC€ 1.7
Q1 2017 5* Hotel Rhodes 691 rooms Eurobank Private Investor € 30.0
Q2 2017 5* Hotel Athens 314 rooms Alpha Bank Hines € 33.0
Q3 2017 Retail Building Thessaloniki2,322
n/a Trastor REIC € 8.4
Source: OECD Data
OverviewThe commercial real estate market in Greece after being almost for a
decade in uncertainty and continuous contraction is presenting signs of
stabilisation and marginal growth especially in the commercial property
sector. The downward trend of the market, is showing signs of
corrections from early 2017 with many investment transactions having
taken place. International institutional or private investors are looking at
the local market mainly focusing on the commercial sector and in
particular on hospitality assets. Investment funds hold a wait-and-see
approach with regards to the NPLs portfolios held by the Greek banking
system. Expectations in the RE market point to gradual recovery,
awaiting for a number of transactions of prime properties to be
completed in the coming years. New development activity is not
forecasted to pick up any time soon, especially as long as there is
adequate stock of properties to cover investors' demand.
Investment Volume in the Greek Real Estate Market
0 200 400 600 800 1000 1200
2012
2013
2014
2015
2016
2017F
in mn €
Source: NAI Hellas
Source: NAI Hellas
Opportunities The eventual stabilisation of the macroeconomic and political
environment in Greece is the most important development in 2017 and
the most significant coefficient for the recovery and growth of the
country's real estate market. Investment interest for the Greek CRE
market is strong with the hospitality sector leading the way. The
sector's excellent performance is breaking each year's international
arrivals record making both city and resort hotels some of the most
attractive investment assets. Focus remains sound for asset backed
NPLs with the Greek banks holding a portfolio of non-performing loans
exceeding €100 bn. New development projects are scarce and concern
merely the hospitality sector while for the rest of the CRE market in
Greece redevelopment / refurbishment schemes are starting to pick up.
18
Source: NAI HellasSource: NAI Hellas
Grade A Office (@ prime location)
0%
1%
2%
3%
4%
5%
6%
7%
8%
9%
€ -
€ 50
€ 100
€ 150
€ 200
€ 250
2010 2011 2012 2013 2014 2015 2016 2017E 2018F
Yield
Ren
t (in
€/m
2/an
num
)
Athens Rent Thessaloniki Rent Athens Yield Thessaloniki Yield
Grade A Warehouse / Logistics
( >5,000m2 @ prime location)
0%
2%
4%
6%
8%
10%
12%
14%
€ -
€ 10
€ 20
€ 30
€ 40
€ 50
€ 60
€ 70
2010 2011 2012 2013 2014 2015 2016 2017E 2018F
Yield
Ren
t (in
€/m
2/an
num
)
Athens Rent Thessaloniki Rent Athens Yield Thessaloniki Yield
High Street Retail (@ prime location)
0%
1%
2%
3%
4%
5%
6%
7%
8%
€ -
€ 500
€ 1.000
€ 1.500
€ 2.000
€ 2.500
€ 3.000
2010 2011 2012 2013 2014 2015 2016 2017E 2018F
Yield
Ren
t (in
€/m
2/an
num
)
Athens Rent Thessaloniki Rent Athens Yield Thessaloniki Yield
Source: NAI Hellas
The office market in Greece has substantially contracted over
the past years due to constant pressures that the economy has
been experiencing. In 2016 the Grade A office market showed
marginal increase in terms of rental levels compared to 2015,
mainly as an outcome of continuous reduction in supply. Lack of
new development projects resulted in the take up of existing
quality stock at a marginally higher rent. Vacancy rates in the
top three office locations in Athens have decreased over the last
two years for both Grade A and B stock exhibiting an increasing
take-up trend.
The logistics market in Greece, as opposed to industrial
properties, is a sector attracting increased investment interest
lately supported by many important infrastructure projects that
have been completed. The country's advantageous
geographical position together with the privatisation projects in
Piraeus and Thessaloniki commercial piers as well as the
National Railway have managed to place the logistics hubs of
Athens and Thessaloniki on investors' map. Occupancy rates
for Grade A logistics properties is as high as c. 95%.
Noteworthy activity was recorded in the high street retail market
of Athens during 2016-2017. Many international retailers
reinforced their position in the traditional Athenian shopping
locations with supply being low. Prime rents remained
unchanged or increased marginally due to limited or zero supply
of vacant space. Gradual improvement was also recorded in the
high street market of Thessaloniki with increased take up
leading to lower vacancy rates and higher rental levels.
19
Major Transactions 2016 - 2017
Source: OECD Data
OverviewThe investment volume up to H1-2017 has reached a remarkable €5.8 bn, due
to a strong 2Q of €4bn (+58% QoQ). There has been a continuation in the trend
started in 2016 characterised by foreign investors' interest in Italian CRE
motivated by relative considerations; national investors as well have been
active, mostly investment management companies (Sgr). The foreign
contribution to this new capital is very high at 80%, c. €4.6 bn (+67% vs H1-
2016), with domestic capital at 20%, €1.2 bn. The proportion of these
investments is represented by: 34% offices (€2 bn, +30% vs H1-2016), 21%
retail (€1.2 bn, +76% vs H1-2016), 14% logistics (€0.8 bn, +291% vs H1-2016),
13% hotels (€0.77 bn, +49% vs H1-2016), 18% alternatives (c. €1 bn, +100%
vs H1-2016). The NPL market has finally seen large interesting transactions
originated and executed as a testimony of the commitment from banks,
investment managers, investors, regulator and other key players to make 2017
the breakthrough year. The geographical area having experienced the highest
growth vs previous semester is Rome, with €1 bn new invested cash being
+30% vs H1-2016; Milan is still leading in terms of absolute amount though with
€1.8 bn, +25% vs H1-2016, and nearly half of it represented by offices. Prices
in general have followed a positive evolution as rent levels are in a marked
downward trend, especially on core prime opportunities.
Investment Volume in the Italian Real Estate Market
So
urc
e: N
AI Ita
ly
Source: NAI Italy
Opportunities The outlook for the second half of 2017 in terms of invested
volumes is still positive with Institutional Investors' presence
strong and widespread. In the coming years there will be several
investment opportunities also coming from the Public Sector and
the State which is trying to rationalize its estate as well as
attracting necessary investments for upgrade the state of repair of
strategic assets. As economic growth stabilizes and foreign
investments keep on at a steady pace, the outlook on prices
remains positive as on a relative basis Italian assets have still
some upside potential to achieve.
Country Profile
Population (mn) 60.4
Capital city Rome
Currency Euro (€)
Country Macroeconomic Profile (2016)
GDP $ 2,312 bn
GDP growth 0.99%
Unemployment rate 11.7%
Inflation -0.09%
Contact Details
Carlo Bragazzi, Senior Partner
Head of Alternative Investment Solutions
c.bragazzi@naiitaly.com
NAI Italy
Via Monte di Pietà 21,
20121 Milan
+39 02 8633 7703
www.naiglobal.com
0 1 2 3 4 5 6 7 8 9 10
2012
2013
2014
2015
2016
in bn €PeriodProperty
TypeLocation
Size
(m2)Vendor Buyer
Price (in
mn)
2016 - Q2
2017Office Building Rome, Milan n/a
Milano 90 Srl
(Scarpellini)
Tristan, York
Capital, Feidos€ 510
Q1 2017 Office BuildingMilan city
centre12,000 Luxottica Hines Italia € 100
Q1 2017 Shopping Center Bari n/a BNP Paribas REIM Serenissima Sgr € 61
Q1 2017 Retail Building Various cities n/a Feltrinelli Group Coima Sgr € 50
Q1 2017 Retail BuildingMilan city
centre3,750 Porta Rossa
Meyer Bergman
European Retail
Partners III
€ 55
Q1 2017 Office BuildingsMilan, Rome,
Bari91,000
Cloe Office Fund
(Prelios Sgr)
AREEF Fund 1
Italy (Ardian RE
European Fund)
€ 300
Q2 20175 Star Luxury
Hotels
Rome, Venice,
Florence~ 500 rooms
B5 srl (Boscolo
Family)Varde Partners n/a
Q3 2017 Office Buildings Milan n/aEdison (sale &
lease back deal)
Fondo Ippocrate
(Idea Fimit Sgr)€ 270 20
Source: NAI ItalySource: NAI Italy
Grade A Office (@ prime location) Grade A Warehouse / Logistics
( >5,000m2 @ prime location)
High Street Retail (@ prime location)
Source: NAI Italy
The interest from international investors in the office market has
continued its trend during the first half of 2017. Milan maintains
the leading place in the country; the supporting factors for this
overperformance are a larger number of opportunities, lower
perceived risks and a superior stock quality. The activity in the
Milan market has increased further registering a peak over the
last decade. The interest and activity in the Rome office market
is similar to last year's levels. The vacancy rate in Rome is
going down also because owners are in the process of taking
out from the market their assets to refurbish them in order to
attract proper interest going forward. Investors are still showing
a keen preference on core assets, however, as the availability of
such good quality products is now limited, the demand for
value-added opportunities is growing. There should be a
continuation of this positive trend especially on core assets in
core locations with value added opportunities emerging in a
more regular fashion as prime yields remain compressed.
Q1-2017 has been marked by a very strong start in the logistic
market with €145 mn of new investments, +238% vs Q1-2016,
through four transactions executed by foreign investors and the
largest one by a local investment manager, Kryalos Sgr. Most
of the activity is concentrated on build to suit/refurbished
opportunities since the demand for core assets is still dominant
and the speculative developments have yet to consolidate.
Prime net yields have experienced a further contraction
compared to the previous year. Lombardy and Emilia
Romagna remain the two more dynamic regions in terms of
take-up and 3PL operators have the lions' share in the logistic
space take up to date, since E-commerce ones have scaled
down.
Investment volumes in Q1-2017 have decreased compared to
the previous' year period with high street opportunities still
leading attracting more than 2/3 of the total. Foreign investors
are yet again dominating the arena. Prime rents in Milan and
Rome are stable for both high street and shopping centers whilst
yields are in a steady declining trend. Because of these low yield
levels now international investors are willing to consider
secondary cities as well as refurbishment/new development
projects. A two rounds auction process has been tried for prime
high street core assets in Milan (8.3k m2 & €5.7 mn p.a. rent) and
Rome (850 m2 & €2.6 mn p.a. rent): NBO received by the owners
who then shortlisted the counterparties having shown the better
offer terms giving them VDR access for the second round.
0%
2%
4%
6%
8%
10%
12%
14%
16%
€ -
€ 100
€ 200
€ 300
€ 400
€ 500
€ 600
2010 2011 2012 2013 2014
Yield / V
acancy Rate
Ren
t (in
€/m
2/an
num
)
Milan Rent Rome Rent Milan Yield
Rome Yield Milan Vacancy Rate Rome Vacancy Rate
0%
2%
4%
6%
8%
10%
12%
€ 48
€ 50
€ 52
€ 54
€ 56
€ 58
€ 60
€ 62
2010 2011 2012 2013 2014
Yield / V
acancy Rate
Ren
t (in
€/m
2/an
num
)
Milan Rent Rome Rent Milan Yield
Rome Yield Milan Vacancy Rate Rome Vacancy Rate
0%
2%
4%
6%
8%
10%
12%
€ -
€ 2.000
€ 4.000
€ 6.000
€ 8.000
€ 10.000
€ 12.000
€ 14.000
€ 16.000
2010 2011 2012 2013 2014
Yield / V
acancy Rate
Ren
t (in
€/m
2/an
num
)
Milan Rent Rome Rent Milan Yield
Rome Yield Milan Vacancy Rate Rome Vacancy Rate
21
Major Transactions 2016 - 2017Source: OECD Data
OverviewThe investments in real estate continued to show positive results after
steep decline during the financial crises. Market witnessed remarkable
investment growth pointing to €730 mn over last 2 years returning to pre-
crises levels. The main drivers for the investment growth are relatively
good access to financing, low interest rate environment, increasing
liquidity, lack of high-yielding alternatives and lack of prime real estate
assets, which are also the main factors putting downward pressure on
yields, compressing those by even 100 to 200 bps. Up to the end of 2016
most demanded were substantial cash flow generating retail and office
assets. H1-2017 has shown positive investment volume growth also in
industrial / warehouse segment, however total H1-2017 investment
volumes has slowed down compared to previous years, which is
explained by a shortage of an attractive investment properties in Riga.
Considering great interest from investors and the lack of large modern
office space, high new development activity has been noted, which in the
nearest future will supplement office market space by at least 150k m2.
The same pace of development activity is shown also in other commercial
segments - retail and industrial/warehouse, providing positive ground for
new investment deals.
Investment Volume in the Latvian Real Estate Market
Source: NAI Baltics
Source: NAI Baltics
Opportunities Investor interest towards prime cash flow generating assets will remain
high, keeping low yield levels. Nevertheless quite notable reduction,
yield gap is still favorable compared to Scandinavian and Western
European levels. Opportunity to gain better yields is the main reason for
new profile and geography investor appearance in the region.
Contact Details
Valdis Ligers, LLB, MRICS
Principal
valdis.ligers@naibaltics.com
NAI Baltics
95 Brivibas Str., Riga, Latvia
+37129473300
www.naibaltics.com/
Country Profile
Population (mn) 2.0
Capital city Riga
Currency Euro (€)
Country Macroeconomic Profile (2016)
GDP $ 50 bn
GDP growth 1.95%
Unemployment rate 9.60%
Inflation 0.14%
0 50 100 150 200 250 300 350 400 450
2010
2011
2012
2013
2014
2015
2016
2017F
in mn €PeriodProperty
TypeLocation Size (m2) Vendor Buyer
Price
(in mn)
Q3 2016 Retail Riga 49,000 Diksna Lone Star € 93.40
Q2 2016 Retail Riga 42,000 KanAm Grund EfTEN € 74.50
Q3 2016 Office Riga 10,000 Bauplan Nord Baltic Horizon € 23.00
Q1 2016 Office Riga 36,500 SWH Group Private investors € 20.00
Q4 2016 Retail Riga 20,000Nunica
HoldingsKesko Group € 12.50
Q2 2017 Retail Latvia 39,000 Kesko GroupBaltic Retail
Propertiesn/a
22
Source: NAI BalticsSource: NAI Baltics
Grade A Office (@ prime location) Grade A Warehouse / Logistics
( >5,000m2 @ prime location)High Street Retail (@ prime location)
Source: NAI Baltics
Modern office stock is concentrated in Riga amounting to
610k m2. Modern stock increase by 150k m2 is expected in
coming years. New speculative developments capable to
attract tenants during construction stage, providing positive
sentiment for further investments. Demand is mostly driven by
financial sector and IT companies, consolidating in single
locations with further expansion possibilities. Expansions are
based on improving economic environment. International
companies are willing to relocate their back-office units to
Latvia. Rent rates expected to increase gradually. Vacancy
will witness slight reduction in A class buildings. Occupancy
fluctuations in older buildings without adequate Capex
investments is most likely.
Modern office stock is concentrated in Riga amounting to
610k m2. Modern stock increase by 150k m2 is expected in
coming years. New speculative developments capable to
attract tenants during construction stage, providing positive
sentiment for further investments. Demand is mostly driven
by financial sector and IT companies, consolidating in single
locations with further expansion possibilities. Expansions are
based on improving economic environment. International
companies are willing to relocate their back-office units to
Latvia. Rent rates expected to increase gradually. Vacancy
will witness slight reduction in A class buildings. Occupancy
fluctuations in older buildings without adequate Capex
investments is most likely.
Modern office stock is concentrated in Riga amounting to
610k m2. Modern stock increase by 150k m2 is expected in
coming years. New speculative developments capable to
attract tenants during construction stage, providing positive
sentiment for further investments. Demand is mostly driven
by financial sector and IT companies, consolidating in single
locations with further expansion possibilities. Expansions are
based on improving economic environment. International
companies are willing to relocate their back-office units to
Latvia. Rent rates expected to increase gradually. Vacancy
will witness slight reduction in A class buildings. Occupancy
fluctuations in older buildings without adequate Capex
investments is most likely.
0%
2%
4%
6%
8%
10%
12%
€ -
€ 50
€ 100
€ 150
€ 200
€ 250
2010 2011 2012 2013 2014 2015 2016 2017E 2018F
Yield / V
acancy Rate
Ren
t (in
€/m
2/an
num
)
Riga Rent Riga Yield Riga Vacancy Rate
0%
2%
4%
6%
8%
10%
12%
€ 45
€ 46
€ 47
€ 48
€ 49
€ 50
€ 51
€ 52
€ 53
€ 54
€ 55
2010 2011 2012 2013 2014 2015 2016 2017E 2018F
Yield / V
acancy Rate
Ren
t (in
€/m
2/an
num
)
Riga Rent Riga Yield Riga Vacancy Rate
0%
2%
4%
6%
8%
10%
12%
€ -
€ 50
€ 100
€ 150
€ 200
€ 250
€ 300
€ 350
€ 400
2010 2011 2012 2013 2014 2015 2016 2017E 2018F
Yield / V
acancy Rate
Ren
t (in
€/m
2/an
num
)
Riga Rent Riga Yield Riga Vacancy Rate
23
Major Transactions 2016 - 2017
Source: Swedbank
OverviewReal estate investment market have been substantially active,
dominating by Scandinavian and Baltic investors as well as international
investment funds. Office and retail segments with sustainable cash flow
have attracted the highest investment volumes. Increased investors
interest to invest in Lithuanian real estate market was one of the drivers
to yield compression by 100-150 bps. Nevertheless, investment yields
are still higher compared to Nordic and Western European countries.
Prime investment yields for office and retail properties bottomed out to
6.75% and maintained at 8% level for industrial properties. Notably
active has been office sector in terms of new developments – five large
office centers have been put into operation during 2016, followed by
another 82 tgh sqm to be completed by the end of 2017. Lithuanian
office market is benefitting from Shared Service Centers by international
companies. Extreme development has been observed also in hotel
segment, since in Vilnius there is the least number of hotel rooms
compared to other Baltic capitals, although tourist flow is raising YoY.
Investment Volume in the Lithuanian Real Estate Market
Source: NAI Baltics
Source: NAI Baltics
Opportunities Taking into account positive economic outlook and still comfortable level
of returns from investments in comparison with the Nordic and Western
countries, as well as acceptable risk, we expect that investors interest will
remain high. Prime yields are expected to continue downward trend, yet
maintaining favorable levels compared to other regions.
Contact Details
Valdis Ligers, LLB, MRICS
Principal
valdis.ligers@naibaltics.com
NAI Baltics
95 Brivibas Str., Riga, Latvia
+37129473300
www.naibaltics.com/
Country Profile
Population (mn) 2.9
Capital city Vilnius
Currency Euro (€)
Country Macroeconomic Profile (2016)
GDP $ 28 bn
GDP growth 2.30%
Unemployment rate 7.90%
Inflation 0.90%
0 50 100 150 200 250 300 350 400 450 500
2010
2011
2012
2013
2014
2015
2016
2017F
in mn €
PeriodProperty
TypeLocation Size (m2) Vendor Buyer
Price
(in mn)
Q1 2016 OfficeBaltic
countries84,000 Geneba Laurus € 87
Q2 2017 Office Vilnius 13,800 ICOR Group Technopolis € 32
Q2 2017 Office Vilnius 9,000 LaurusEast Capital
Explorer AB€ 29
Q1 2017 Office Vilnius 8,300YIT Kausta
būstasBaltic Horizon € 15
24
Source: NAI BalticsSource: NAI Baltics
Grade A Office (@ prime location) Grade A Warehouse / Logistics
( >5,000m2 @ prime location)High Street Retail (@ prime location)
Source: NAI Baltics
Office market experiences rapid development pace. Last year
total modern office stock was supplemented by 95 K m2 or 19%
y-o-y amounted to 597 K m2, even more substantial growth
expected within two consecutive years adding another 200 K m2
to Vilnius office market, mainly supplementing A class
properties located in CBD. Demand is mainly driven by
banking, insurance and financial services, IT and customer
contact services. Vilnius have been awarded best city for SSC
in CEE, and as the destination of choice for the top brands, as
Nasdaq and Barclays, Vilnius is firmly on the map as a growth
centre for SSC development.
Vilnius warehouse/logistics market was continuing intensive
built-to-suit development pace, however speculative
development activity is also taking place adding to the market
three such logistics centers. Satisfactory take-up activity for
speculative constructions reflects high demand for modern
logistics facilities, giving positive ground for slight rent rate
upward trend, yet quite substantial stock increase may put
downward pressure on occupancy, still maintaining it in
comfortable level. Increased demand for combined
production/warehouse facilities is observed. Positive economic
outlook and convenient geographical location contributes to
further growth of Lithuanian warehouse/logistics market.
Retail property market was mostly activated by grocery chains,
developing new stores or reconstructing existing ones. Stock
expansion will be mostly driven by extension of existing SC. In
order to increase number of visitors SC owners are hardly
working on extension of entertainment and leisure areas, due to
increasing purchasing quality demands and changing habits.
More active have become street retail segment. Vacancy level
in shopping centers is low, forming good base for rent rates
growth in the future.
0%
2%
4%
6%
8%
10%
12%
14%
16%
€ -
€ 50
€ 100
€ 150
€ 200
€ 250
2010 2011 2012 2013 2014 2015 2016 2017E 2018F
Yield / V
acancy Rate
Ren
t (in
€/m
2/an
num
)
Vilnius Rent Vilnius Yield Vilnius Vacancy Rate
0%
2%
4%
6%
8%
10%
12%
14%
€ -
€ 10
€ 20
€ 30
€ 40
€ 50
€ 60
€ 70
2010 2011 2012 2013 2014 2015 2016 2017E 2018F
Yield / V
acancy Rate
Ren
t (in
€/m
2/an
num
)
Vilnius Rent Vilnius Yield Vilnius Vacancy Rate
0%
1%
2%
3%
4%
5%
6%
7%
8%
9%
10%
€ -
€ 50
€ 100
€ 150
€ 200
€ 250
€ 300
€ 350
€ 400
2010 2011 2012 2013 2014 2015 2016 2017E 2018F
Yield / V
acancy Rate
Ren
t (in
€/m
2/an
num
)
Vilnius Rent Vilnius Yield Vilnius Vacancy Rate
25
Major Transactions 2016 - 2017
Source: OECD Data
OverviewOwing to low interest rates among other things, the economy continued to
pick up in 2016 en was lifted to new records. Within a single year, an
unprecedented amount of properties had been sold, including commercial
premises. And yet, there is no denying that some of the sectors were by no
means served by those positive changes. Like the residential property
market for instance, going too far at some levels. No market has benefited
more from low interest rates than the housing market. Last year the
number of existing owner-occupied houses sold went up by more than
16%; national prices climbing by nearly 9%. Similar numbers were
reported in the new buildings segment of the owner-occupier housing
market. The housing market picked up in almost every region, however
some segments had become overheated. With the city being so incredibly
attractive, demand exceeded supply significantly. Prices skyrocketed, with
those interested having to pay beyond the asking price in many cases.
Prices also climbed substantially on the private sector rental market, in fact
by nearly 8% per m2.
Investment Volume in the Netherlands Real Estate Market
Source: NAI Netherlands
Opportunities Investors appetite continued to remain high in the first six months of
2017, although, the availability of prime investment products in
dominant areas of the country is rather limited. The outlook on the
Dutch investment market continues to improve due to a positive
economic growth, declining unemployment rate and a growing
consumer confidence.
Country Profile
Population (mn) 16.8
Capital city Amsterdam
Currency Euro (€)
Country Macroeconomic Profile (2016)
GDP $ 873 bn
GDP growth 2.13%
Unemployment rate 6.00%
Inflation 0.32%
Contact Details
Robert Das
Managing Director / Partner
robert@nainetherlands.nl
NAI Netherlands
Concertgebouwplein 15
1071 LL Amsterdam
+31 636 40 007
www.nainetherlands.nl/en
0 1 2 3 4 5 6 7 8
2010
2011
2012
2013
2014
2015
2016
2017F
in bn €
PeriodProperty
TypeLocation
Size
(m2)Vendor Buyer
Price
(in mn)
Q2 2017 Office Amstelveen 58,000
Commerz Real
Investment-
gesellschaft
Prowinko n/a
Q1 2017 Office
Amsterdam,
Atrium,
Strawinskylaan
56,000 Icon Real Estate Amundi € 500
Q2 2017 Apartment
Grotius I-II, P.
Clauslaan, Den
Haag
650 units Provast CBRE GI n/a
Q2 2017 Hotel Bilderberg portfolio 16 prop Goldman SachsFirst Sponsor
Group€ 205
Q2 2017 Office Den Haag,
Plesmanweg40,000 Rijksvastgoedbedrijf
Impact
Vastgoed€ 43
Q2-2017 Office Utrecht 40,022CBRE Dutch Offie
FundAnbang € 157
Q3-2017 Logistics Raamsdonkveer 20,499 HB Capital Intervest € 14
Source: NAI Netherlands
26
Source: NAI Netherlands
Grade A Office (@ prime location) Grade A Warehouse / Logistics
( >5,000m2 @ prime location)High Street Retail (@ prime location)
Positive changes also presented themselves on the Dutch office
market in 2016. Demand increased by 25%, supply going down
by 9%. Supply rates also dropped as many offices had been
withdrawn from stock, to Introduction make room for houses
among other things. But despite better market conditions, office
rents hardly changed last year. The lease and sale of office
space in the first half of 2017 was slightly lower compared to the
same period last year. In total the take up was c. 475,000 m2
compared to c 557,000 m2 in the first half year of 2016. Only
45,000 m2 was newly built. In Amsterdam the take-up was 15%
lower compared to the first 6 months 2016. The rental prices
remained stable. Only in Amsterdam in specific areas the rental
prices are tending to rise due to lack of suitable supply.
In the logistic sector total take up was c. 787,000 m2. Most
transactions were in newly built warehouses. Large transactions
were VidaXL which leased 104,000 m2 in Venlo and the lease of
58,000 m2 to Lidl in Roosendaal. Despite the reasonable
demand for logistic space there exist a fear for oversupply. This
is caused because of the fact that on a number of locations
developers started the construction of new logistic warehouses
without any pre-letting. Lease prices remained stable.
The retail market continued to recover as well. Supply
diminished for the first time in years, after successfully
transforming vacant stores into residential, office or hospitality
areas. Letting out many of V&D’s previous stores ensured a
record take-up of 1.1 mn m2. But still, the retail market was
unmistakably divided as intensifying demand and falling supply
levels in large cities were offset by poor demand and high
vacancy rates in medium-sized and small towns. Despite an
improving market the recovery of the retail sector remains fragile
with insolvencies that continue to target the sector, although
these are increasingly used for drastic operational restructuring.
Different retail sectors show an improvement in turnover sales,
especially online retail trad registered a strong performance. The
outlook on the Dutch retail market continues to improve due to a
positive economic growth, declining unemployment rate and a
growing investment pressure as interest rates remain low.
0%
2%
4%
6%
8%
10%
12%
€ -
€ 500
€ 1.000
€ 1.500
€ 2.000
€ 2.500
€ 3.000
€ 3.500
2010 2011 2012 2013 2014 2015 2016 2017E 2018F
Yield / V
acancy Rate
Ren
t (in
€/m
2/an
num
)
Amsterdam Rent Rotterdam Rent
Amsterdam Yield Rotterdam Yield
Amsterdam Vacancy Rate Rotterdam Vacancy Rate
0%
5%
10%
15%
20%
25%
€ -
€ 10
€ 20
€ 30
€ 40
€ 50
€ 60
€ 70
2010 2011 2012 2013 2014 2015 2016 2017E 2018F
Yield / V
acancy Rate
Ren
t (in
€/m
2/an
num
)
Amsterdam Rent Rotterdam Rent Amsterdam Yield
Rotterdam Yield Amsterdam Vacancy Rate Rotterdam Vacancy Rate
Source: NAI Netherlands
0%
5%
10%
15%
20%
25%
€ -
€ 50
€ 100
€ 150
€ 200
€ 250
€ 300
€ 350
€ 400
2010 2011 2012 2013 2014 2015 2016 2017E 2018F
Yield / V
acancy Rate
Ren
t (in
€/m
2/an
num
)
Amsterdam Rent Rotterdam RentAmsterdam Yield Rotterdam YieldAmsterdam Vacancy Rate Rotterdam Vacancy Rate
Source: NAI Netherlands
27
PeriodProperty
TypeLocation
Size
(m2)Vendor Buyer
Price
(in mn)
Q1 2016 Acquisition n/a n/aEcho
Investment
Redefine
Properties€ 1,200
Q4 2016 Office BuildingWarsaw City
centre53,000
Echo
Investment
INVESCO Real
Estate European
Fund
€ 230
Q3 2016 Retail building Krakow city centre 91,000Trios Dutch
Holdings
Rockcastle Global
Real Estate€ 361
Q3 2016 Office BuildingWarsaw Żoliborz
District48,000 HB Reavis
Savills Investment
Management€ 186
Q3 2016 Retail building Zielona Góra 26,800Aviva
Investors
Rockcastle Global
Real Estate€ 161
Q3 2016 Retail buildingPiotrków
Trybunalski35,286
Q4 2016 Retail building Olsztyn 42,711Galeria
Warmińska
Rockcastle Global
Real Estate€ 150
Q1 2017 8 Hotels n/a n/a Warimpex U City € 180
Major Transactions 2016 - 2017
Source: OECD Data
OverviewPoland is the largest country in the CEE region with over 38 mn
inhabitants. Experts forecast that investment volume in 2017 will reach
similar value as in previous year, and considering that 2016 achieved
the highest recorded investment volume of €4.5 bn, keeping it on a
similar level may indicate that Poland is experiencing a stable growth.
Investment transactions recorded in 2016 state clearly that Poland
remains a desirable destination among international investors. Over
90% of the investment transactions in the Polish market in 2017 were
conducted by foreign investors. Prime rents in major cities remain
stable, as well as prime yields. Additional beneficial factors include the
steadily lowering unemployment rate and growing retail sales. It is
predicted that the country’s GDP should remain above European
Union's average and oscillate at around 3% per year. Polish economy
was mostly unaffected by the recent political changes in the EU and in
the USA which allows for it’s steady growth.
Investment Volume in the Polish Real Estate Market
Source: NAI Estate Fellows
Opportunities In the coming years Poland will continue to offer many opportunities
for investors to diversify their real estate portfolios. High activity
from both developers and clients keeps the market in high gear.
Therefore it is becoming more common to observe pre-let
agreements in buildings that are under construction.
Country Profile
Population (mn) 38.5
Capital city Warsaw
Currency Polish złoty (PLN)
Country Macroeconomic Profile (2016)
GDP $ 1,055 bn
GDP growth 2.68%
Unemployment rate 6.20%
Inflation -0.66%
Contact Details
Bartosz Pustuł
Property Management Director
bartosz.pustul@estatefellows.com
NAI Estate Fellows
Warsaw, Pankiewicza 3
00-696
+48 22 379 73 00
www.estatefellows.com
0 1 2 3 4 5
2010
2011
2012
2013
2014
2015
2016
2017F
in bn €
Source: NAI Estate Fellows
28
Grade A Office (@ prime location) Grade A Warehouse / Logistics
( >5,000m2 @ prime location)High Street Retail (@ prime location)
The Polish office market is developing in a steady manner.
Regional cities are experiencing high occupancy rates which
supports increased development activity. Developers remain
strongly influenced by the BPO/SSC sector which is a main
force propelling regional cities towards development. Krakow
as one of the most popular targets in Europe for BPO/SSC is
expected to provide an additional 300,000 m2 of office space
this year. Yet the leader in Poland’s office market is still the
capital city - Warsaw. Thanks to it’s dynamic growth and
constant interest of companies in Warsaw, flow of modern
offices continues.
The industrial market in Poland can be characterised by it’s very
low vacancy rate and stable rental levels. Warsaw’s suburban
area achieved best score in it’s industrial history by reaching the
lowest vacancy level of 5.5%. On the other hand, Krakow is
experiencing high supply of industrial space which resulted in
it's stock increase by nearly 90% in the last two years.
Prospects for future development of regional markets remain
positive in the upcoming years.
Retail rents in prime locations are expected to remain stable,
whereas in secondary locations rents are expected to fall in
response to growing competition. A small shift from main
markets towards regional cities with population around 100k
population inhabitants is being recorded. The prime retail
market in Poland is Warsaw. From c. 690,000 m2 of GLA space
under construction over half is located in Warsaw and the rest in
other main region cities. Current economic changes (lowering
unemployment, 500+ program) empower the growth of retail
market in Poland.
Source: NAI Estate FellowsSource: NAI Estate Fellows
0%
1%
2%
3%
4%
5%
6%
7%
8%
€ -
€ 200
€ 400
€ 600
€ 800
€ 1.000
€ 1.200
€ 1.400
2010 2011 2012 2013 2014 2015 2016 2017E
Yield / V
acancy Rate
Ren
t (in
€/m
2/an
num
)
Warsaw Rent Kraków Rent
Warsaw Yield Kraków Yield
Warsaw Vacancy Rate Kraków Vacancy Rate
0%
2%
4%
6%
8%
10%
12%
14%
€ -
€ 10
€ 20
€ 30
€ 40
€ 50
€ 60
€ 70
2010 2011 2012 2013 2014 2015 2016 2017E
Yield / V
acancy Rate
Ren
t (in
€/m
2/an
num
)
Warsaw Rent Kraków Rent Warsaw Yield
Warsaw Vacancy Rate Kraków Vacancy Rate
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
€ -
€ 50
€ 100
€ 150
€ 200
€ 250
€ 300
€ 350
2010 2011 2012 2013 2014 2015 2016 2017E 2018F
Yield / V
acancy Rate
Ren
t (in
€/m
2/an
num
)
Warsaw Rent Kraków Rent
Warsaw Yield Kraków Yield
Warsaw Vacancy Rate Kraków Vacancy Rate
Source: NAI Estate Fellows
29
Major Transactions 2016 - 2017
Source: Eurostat
OverviewRomania registered a strong economic growth in 2016, with most indicators reporting
improving results as compared with the previous year. Internal consumption was the
main source of growth, being stimulated by tax reductions, increases in salaries and low
interest rates. GDP reported a 4.8% jump which represents an 8-year record rate.
Economy is planned to continue to grow in 2017 based on internal consumption. VAT
was reduced from 20% to 19% from the start of 2017, while public salaries and
pensions were increased by 20%, respectively 9%. Unemployment is expected to
decrease further as business sector is likely to expand in both production and services.
IT&C sector is expected to continue at high speed, with Romania to strengthen its
ranking as a major destination for outsourcing and regional / global services centers. In
2016, the office market was considered the most attractive segment of the real estate
market, being responsible for half of the transactions. The most important transaction on
the national real estate market was represented by the acquisition of 26.88% of the
capital of Globalworth, one of the major players on the office market by the South-
African investment fund Growthpoint for 186 mil. Euro.
Opportunities The Romanian real estate market is currently in an
expansion phase. Good opportunities are available on
all segments of the real estate market. The general
macroeconomic environment favor moderate
development of the Romanian real estate market during
2017 and in the near future. The development activity is
intense on residential, retail and office markets and the
industrial segment still remains a valuable opportunity
for investors to diversify their portfolios. Although on its
path to maturity, the Romanian real estate market
exhibits high yields when compared to other Central
and Eastern European countries and has become a
more attractive environment for investments.
Source: NAI Romania
Country Profile
Population 19.6
Capital city Bucharest
Currency LEU (ROL)
Country Macroeconomic Profile (2016)
GDP $ 462 bn
GDP growth 4.40%
Unemployment rate 5.20%
Inflation -1.10%
Period Property Type Location Size (m2) Vendor BuyerPrice
(in mn)
2016Logicor Logistics
Portfolio
Entire European
Portfolion/a Immofinanz Blackstone € 305
2016
2 Office Buildings -
Premium Plaza and
Premium Point
Bucharest 14,385 Volksbank GTC € 35
2016 Sibiu Shopping City Sibiu 79,100 Argo Real Estate NEPI € 100
2016Mega Mall Bucharest
30%Bucharest 75,200 Real4You NEPI € 71
2016Metropolis Center
(Office)Bucharest 18,695 Soravia PPF Real Estate € 48
2016 Swan Park Bucharest 29,125 Casa de Insolventa
Transilvania
Smartown
Investments€ 30.3
2016 Phoenix Tower Bucharest 10,000
Aberdeen Asset
Management and
Commerzbank
Adam America € 10
2016 McDonald's Restaurants Romania 67 restaurants McDonald's Premier Capitals € 65.3
2016P3 Logistics Park
BucharestBucharest 300,000
TPGRE/ Ivanhoe
Cambridge
GIC Investment
Fund Singapore€ 2,400
2017 Construdava Bucharest 9,400 Aberdeen Asset
ManagementAdam America € 7
2017 ART Business Center Bucharest 18,600 Art Group Hili Properties € 30
2017Logicor Logistics
Portfolio
Entire European
Portfolio13,700,000 Blackstone China Investment € 12,250
2017 Green Court 3 Bucharest 16,300 Skanska Globalworth € 38
Contact Details
Andrei Botis
Managing Partner
andrei.botis@nairomania.ro
NAI Romania
87 Nicolae Caramfil, 4th floor,
Bucharest, District 1, 014143.
+40 311 011 890
www.nairomania.ro30
Grade A Office (@ prime location) Grade A Warehouse / Logistics
( >5,000m2 @ prime location)High Street Retail (@ prime location)
In 2016, the office market was the most attractive segment of
the real estate market. In Bucharest, the main development
poles were Grozavesti, Pipera and the central zone. The
development of new office projects in the central area - Victoria
Office Building, Center Square, Unirii View - and close to the to
the subway stations Grozavesti and Politechnica - Skanska, CA
Immo, The Bridge offers to the employers an alternative to the
increasing agglomeration in the Northern part of Bucharest.
33% of the lease transactions on the office segment in
Bucharest were realized in Grozavesti area. New buildings with
a total of 265,000 m2 GLA were completed last year in
Bucharest, at the highest level in 7 years. Modern office stock in
the capital reached 2.44 mn m2 GLA at year-end, out of which
75% is A-class stock. The Romanian market continues to offer
high yields (7.50%-9.00%) compared to other Central European
markets.
Industrial sector continued on a positive trend, being noted further
improvements in this segment. There was registered a strong
leasing activity and a high volume of new supply delivered at
national level. Development activity accelerated last year to a total
of 400,000 m2 GLA of new developed space at national level. In
2016, Bucharest’s stock increased by 190,000 m2 GLA and it has
consolidated its position as the main industrial market in Romania,
reaching 1,170,000 m2 GLA of modern industrial stock. With a
stock under construction of 110,000 m2 and new extensions
planned, Bucharest’s market is expected to see further growth.
CTP and WDP are the most active developers at national level.
Prime yields in the industrial sector oscillate around 9-10%.
Romania still preserves advantages in terms of competitiveness in
attracting direct investments.
The 2016-2017 period was highly favorable to the retail real
estate market. Increased development will continue in the
following year due to the trend of concentrating the commercial
activity in big modern commercial centers such as the malls,
based on changing preferences of the consumers, especially in
the big cities. The biggest real estate transaction in 2016 belongs
to the investment fund NEPI, which concluded the acquisition of
the shopping center in Sibiu from Argo for €100 mn. During
2016, another 2 shopping malls opened in Bucharest - Park Lake
located in Titan and Veranda in the central area. Bucharest has
exceeded for the first time 1 million sqm of shopping centre
space. A new stock of 311,215 sq m GLA is announced to open
in 2017- 2018 at national level. Highest rents are registered in
Bucharest, being placed at 65-70 Euro/sq m/month double than
the prime rents of 30-35 Euro/sq m/month found in the largest
markets outside the Capital.
0%
2%
4%
6%
8%
10%
12%
€ -
€ 50
€ 100
€ 150
€ 200
€ 250
2012 2013 2014 2015 2016 2017E 2018F
Yield / V
acancy Rate
Ren
t (in
€/m
2/an
num
)
Bucharest Rent Other Rent Bucharest Yield
Other Yield Bucharest Vacancy Rate Other Vacancy Rate
Note: Other cities include Cluj-Napoca, Iasi and
Timisoara
Source: NAI Romania
0%
2%
4%
6%
8%
10%
12%
€ -
€ 10
€ 20
€ 30
€ 40
€ 50
€ 60
2012 2013 2014 2015 2016 2017E 2018F
Yield / V
acancy Rate
Ren
t (in
€/m
2/an
num
)
Bucharest Rent Other Rent Bucharest Yield
Other Yield Bucharest Vacancy Rate Other Vacancy Rate
Note: Other cities include Cluj-Napoca, Iasi and
Timisoara
Source: NAI Romania
0%
2%
4%
6%
8%
10%
12%
€ -
€ 100
€ 200
€ 300
€ 400
€ 500
€ 600
€ 700
€ 800
€ 900
2012 2013 2014 2015 2016 2017E 2018F
Yield / V
acancy Rate
Ren
t (in
€/m
2/an
num
)
Bucharest Rent Other Rent
Bucharest Yield Other Yield
Bucharest Vacancy Rate Other Vacancy Rate
Note: Other cities include Cluj-Napoca, Iasi and
Timisoara
Source: NAI Romania
31
Major Transactions 2016 - 2017
Source: National Bank of Serbia
OverviewDuring 2017 in addition to existing benefits, such as strategic geographical
location, duty-free exports to the countries of South Eastern Europe and
Russia, the lowest corporate tax rate in Europe of 15% as well as an
educated and skilled labor force available at competitive cost, Serbia has
prepared a package of financial support to investors. As a result, Serbia have
made the investment climate together with industrial sector more accessible
and attractive than ever before.
Opportunities What we can see these days is actually the beginning of a new property cycle.
There was long time no better moment to start up a new real estate project in
Belgrade or Serbia. Rents have been bottoming out, occupancy goes up and
construction activity is at historical high. This goes along with a quite stable
demand for commercial property. We at NAI believe that the office market will
take up momentum first, then to be followed by other submarkets.
Source: NAI atrium
Country Profile
Population (mn) 7.1
Capital city Belgrade
Currency Dinar (RSD)
Country Macroeconomic Profile (2016)
GDP € 34 mn
GDP growth 2.80%
Unemployment rate 15.30%
Inflation 1.60%
Contact Details
Roman Klott
Director
klott@nai-atrium.com
NAI atrium
Blvd. Mihajla Pupina 165 G
+381 11 2205 880
www.nai-atrium.com
PeriodProperty
TypeLocation Size (m2) Vendor Buyer
Price
(in mn)
Q1 2016Shopping
centerBelgrade 33,000 Delta
Hyprop Investments &
Homestead Group
Holdings Limited
€ 127.7
32
Grade A Office (@ prime location) Grade A Warehouse / Logistics
( >5,000m2 @ prime location)
High Street Retail (@ prime location)
Intense development activity keeps on from the last year,
resulting in over 50,000 m² of new office space that is added to
the market in 2016. Although market activity in the first half of
the 2016 year recorded y-o-y drop by 30%, due to excellent
results in the previous year, total take-up stands at c. 35,000 m²
and combined with pre-lease activity leads to low vacancy, now
slightly decreased to the level of 6%. Rental levels didn’t record
significant changes, i.e. prime rents for A Class office space are
in range of €14-16.5/m², while B Class prime rates stands in
range €10-14/m². Prime office yields remained unchanged at
the level of 8.5%.
The development of industrial market is speeding up as new
large-scale projects are completed during 2017. Main projects
on the market are those of the big food retailers, LIDL and
Univerexport that choose to built distribution facilities with
announced surface area of approximately 109,000 m². Besides,
new factories of Yazaki, Mai Ta and Lear were opened at the
end of 2016 and in 2017, with total surface of approximately
94,295 m². Depending on location and characteristics, quality
and size, rent levels for modern warehouse space remained
stable, in the interval between €3-5/m². Prime yield reached
level of 10.5%.
Belgrade retail market continued with its recovery in 2017,
which resulted in transactions that took place in Belgrade,
where BIG Shopping Centres, Israeli company bought shopping
center Belgrade Plaza. As a main contribution to the retail
shames stock, two new shopping centers are delivered to the
market with total GLA of 47,600 m², which is together with
another two retail shames as are IKEA and Capitol park
Rakovica bust retail shames stock in Belgrade in 2017 for over
105,000 m². Prime shopping center rents remained stabile in the
range between €20-60/m².
Source: NAI atrium Source: NAI atrium Source: NAI atrium
0%
5%
10%
15%
20%
25%
€ 150
€ 160
€ 170
€ 180
€ 190
€ 200
€ 210
2010 2011 2012 2013 2014 2015 2016 2017E 2018F
Yield / V
acancy Rate
Ren
t (in
€/m
2/an
num
)
Belgrade Rent Belgrade Yield Belgrade Vacancy Rate
3%
4%
5%
6%
7%
8%
9%
10%
11%
€ 20
€ 30
€ 40
€ 50
€ 60
€ 70
€ 80
2010 2011 2012 2013 2014 2015 2016 2017E 2018F
Yield
Ren
t (in
€/m
2/an
num
)
Belgrade Rent Belgrade Yield
3%
4%
5%
6%
7%
8%
9%
10%
€ 200
€ 300
€ 400
€ 500
€ 600
€ 700
€ 800
€ 900
€ 1.000
2010 2011 2012 2013 2014 2015 2016 2017E 2018F
Yield
Ren
t (in
€/m
2/an
num
)
Belgrade Rent Belgrade Yield
33
€ 0 € 5 € 10 € 15 € 20 € 25
2010
2011
2012
2013
2014
2015
2016
2017F
in bn €
Major Transactions 2016 - 2017
Source: OECD Data
OverviewThe Swedish property market keeps attracting foreign and domestic
investment capital thanks to a fundamentally strong economy, paired with
expansive monetary policy, a high level of transparency and liquidity in
the market and a low level of political risk. Funding is still quite easily
obtained. Residential properties, community properties and quality
commercial properties – mainly in metropolitan areas and regional growth
markets – are still seen as the most attractive investments. Prime office
rents have increased rapidly recently. A few suggested changes in
Swedish tax laws are currently being considered, which risks causing
lower liquidity and upward pressure on the lower yield segments
especially. There is also a strong interest for new construction and
development rights. The low interest rates has been contributing to rapidly
accelerating housing prices and household debt, increasing risk.
Investment Volume in the Swedish Real Estate Market
Source: NAI Svefa
Opportunities Depending on future interest rates there is still some room for yield
decline, looking at yield gap and general investor interest. However, the
potential of general yield decline is quite marginal and higher yield
investments such as office properties outside of A-locations or
warehouses & logistic can therefore be seen as interesting alternatives.
Source: NAI Svefa
Country Profile
Population (mn) 9.6
Capital city Stockholm
Currency Swedish krona (SEK)
Country Macroeconomic Profile (2016)
GDP $ 486 bn
GDP growth 3.05%
Unemployment rate 7.00%
Inflation 0.98%
Contact Details
Gustav Källén
Deputy CEO & Head of Investment
gustav.kallen@naisvefa.se
NAI Svefa
Mäster Samuelsgatan 60
103 66, Stockholm, Sweden
+46 10 603 86 00
www.naisvefa.se
PeriodProperty
TypeLocation
Size
(m2)Vendor Buyer
Price
(in mn)
Q2 2017 University Kalmar 38,000 SkanskaIntea
Fastigheter€ 146
Q2 2017Residential
portf.
Greater
Stockholmc. 80,000 Alecta
Heimstaden
Bostad€ 225
Q1 2017 Office BuildingStockholm CBD
West34,000 NIAM
M&G Real
Estate€ 229
Q1 2017Assisted living
fac
Stockholm
suburb23,000
Botkyrka
Municipality
Sterner
Stenhus€ 31
Q1 2017 Retail (Mall)Stockholm
Bromma55,000 Starwood CBRE GI € 220
Q4 2016Prime Office
portfolioNorthern Sweden 235,250 Castellum
Diös
Fastigheter€ 478
Q4 2016 Mixed industry Gothenborg 338,000 AB Volvo Platzer € 291
Q4 2016Residential
portf.Malmö 140,175
Malmö
Municipality
Balder,
Heimstaden &
Victoria Park
€ 115
Q3 2016 Retail (Mall)Stockholm
Kungens Kurva49,400 NIAM
Cavendo,
Capman &
Varma OY
€ 97
34
Grade A Office (@ prime location) Grade A Warehouse / Logistics
( >5,000m2 @ prime location)High Street Retail (@ prime location)
The office market in Sweden's larger cities keeps strengthening,
stimulating new construction at an accelerating rate. Thanks to
a higher level of user efficiency, this has raised rents even
further. The vacancy rates in prime locations are near zero,
which indicates that the market is solid for the time being. Rents
in Stockholm CBD are at record highs. In minor cities however,
the demand for office space seems to be slowly declining.
The Swedish logistics market has seen an increasing amount
of interest from international investors. Most of logistic facilities
are placed within the triangle made up by the three largest
cities, with Gothenburg being the best logistic location for
national transportation. The technical advancements being
made within the sector over the last couple of years has made
new construction more common. In the northern parts of
Sweden, large server centers are being built for some of the
world's largest internet players, thanks to the cold weather
supplying a natural coolant for the servers.
A shift towards e-commerce and low sales growth keeps
putting pressure on the retail market, even though the low
interest rates are giving the Swedish public a lot of room for
consumption after paying their mortgage. The competition
between malls and retail locations has toughened, but the best
and newest malls as well as high street retail is still going
strong. The food and beverage-segment is growing at a fast
pace.
Source: NAI SvefaSource: NAI SvefaSource: NAI Svefa
0%
1%
2%
3%
4%
5%
6%
€ -
€ 100
€ 200
€ 300
€ 400
€ 500
€ 600
€ 700
2010 2011 2012 2013 2014 2015 2016 2017E 2018F
Yield / V
acancy Rate
Ren
t (in
€/m
2/an
num
)
Stockholm Rent Gothenburg Rent
Stockholm Yield Gothenburg Yield
Stockholm Vacancy Rate Gothenburg Vacancy Rate
0%
1%
2%
3%
4%
5%
6%
7%
8%
€ -
€ 20
€ 40
€ 60
€ 80
€ 100
€ 120
€ 140
€ 160
2010 2011 2012 2013 2014 2015 2016 2017E 2018F
Yield / V
acancy Rate
Ren
t (in
€/m
2/an
num
)
Stockholm Rent Gothenburg Rent
Stockholm Yield Gothenburg Yield
Stockholm Vacancy Rate Gothenburg Vacancy Rate
0%
1%
2%
3%
4%
5%
€ -
€ 500
€ 1.000
€ 1.500
€ 2.000
2010 2011 2012 2013 2014 2015 2016 2017E 2018F
Yield / V
acancy Rate
Ren
t (in
€/m
2/an
num
)
Stockholm Rent Gothenburg Rent
Stockholm Yield Gothenburg Yield
Stockholm Vacancy Rate Gothenburg Vacancy Rate
35
Major Transactions 2017
Source: OECD Data
OverviewFollowing a slow start in Q1, the Swiss economy has been stable in 2017 and
is showing signs of progression in some areas in Q3. Although the recovery
has been less rapid than expected, nonetheless, the projected increase of
GDP is 1.4% for 2017 with domestic demand on an upward trend, due in part
to low interest rates and a continuous demand for real estate, combined with
foreign trade, which is showing modest, but stable growth. Inflation remains
low in Switzerland and is expected to settle at an annual average of 0.5% for
2017, reducing further to 0.2% in 2018. Within the job market, the
unemployment rate has also stabilized in 2017, remaining at around 3% with
a general forecast of 3.2% for 2017 (SECO). The Swiss economy is finely
balanced and linked to the Eurozone for its economic progression. Whilst the
trend has been good for the last few quarters, on the basis that the trajectory
continues, we will see the Swiss economy benefit. There are, however, fears
regarding the fragility of Italy’s banking sector, which as one of the larger
members of the Eurozone, could result in financial instability within the zone,
with consequences for the Swiss economy.
Opportunities
The main players in the investment market remain the large
Swiss Institutions. As with previous years, quality product
remains limited. Last year saw a situation of falling rents and
hardening yields, mainly due to low interest rates coupled with
high demand and the obligation for the Swiss funds to
purchase Swiss real estate. Given the lowering of interest
pressures and a slight reduction of demand prime, yields have
eased, with the key purchases by Bank J. Safra Sarasin from
BNP at a value of over CHF 78 mn, representing a yield of just
over 3.25%. AXA however, have recently purchased two
buildings along side of the above building at yields below 3%.
A number of transactions have taken place along
Bahnhofstrasse in Zürich at yields even harder than those
mentioned above. However, away from the CBD, yields soften
between 5%-6% net yield.
Source: NAI Commercial CRE
Country Profile
Population (mn) 8.1
Capital city Bern
Currency Swiss franc (CHF)
Country Macroeconomic Profile (2016)
GDP $ 526 bn
GDP growth 1.31%
Unemployment rate 4.90%
Inflation -0.43% PeriodProperty
TypeLocation Size (m2) Vendor Buyer
Price
(in mn)
Q1 2017 Mixed UseAlexandre-Gavard
rue 16 - GE2,050
FONGEVA
FINANCIERE SA
CAISSE DE
PREVOYANCE
DE L'ETAT DE
GENEVE
CHF 15
Q1 2017 OfficeRue François-Diday
2- GE650 DE PICCIOTTO
RENATO,
SETTON FILIPPO
AXA
ASSURANCES
SA CHF 57.5
Q1 2017 OfficeRue de la corraterie 6
- GE1,250 n/a
Q1 2017 Mixed UseTwo Buildings
Altstetten - ZH3,800 n/a
HELVETICA
SWISS
COMMERCIAL
FUND
CHF 37
Q2 2017 OfficeRue de la Corraterie
4 - GE4,000
BNP PARIBAS
(SUISSE) SA
BANK J. SAFRA
SARASIN AGCHF 70
Q3 2017 OfficeBoulevard Helvétique
10 - GE1,750
IMMOBILIERE
CAPITAL SA
EUNATE REAL
ESTATE SACHF 17.5
Contact Details
Eric Howard BSc FRICS
Chief Executive Officer
e.howard@naicommercial.ch
NAI Commercial CRE AG
Usteristrasse 9, 8001 Zürich
+41 44 221 04 04
www.naiglobal.com 36
Grade A Office (@ prime location) Grade A Warehouse / Logistics
( >5,000m2 @ prime location)High Street Retail (@ prime location)
Whilst the overall office supply has increased in Zürich due to
new developments to the south, west, north (Airport) and the
Europaallee scheme alongside Zürich’s main railway station,
vacancy levels within the CBD area of Zürich have stabilised
despite a prolonged period of increasing over supply. This
improvement is mainly due to important take-up by large
institutions, such as Google’s decision to lease over 50,000 m2
within Europaallee: Absorption levels are creating an equilibrium
within the market, therefore growth may be anticipated within the
following 12 months with stabilising supply and falling vacancy
levels. Subject to quality of buildings, rents are between CHF
770 and CHF 750/ m2 p.a. for prime office space. Geneva’s
prime CBD market experienced a continued decline in the first
two quarters of 2017. However, Q3 has seen a stabilisation
within the CBD. The outer areas have seen a mixed response
with strong take-up for the new developments in Pont-Rouge to
the south west of Geneva, whereas the airport area to the north
and west remains sluggish with high levels of vacancy. Despite
the fall in rents, only now have office rents realigned themselves
to that of Zürich.
Warehousing and R&D rental market is not a strong sector in
Switzerland, with occupiers preferring to own. However,
incentives are being offered by several Cantons, such as Zug,
Luzern and Schywz to attempt to attract pharmaceutical, biotech
and medical-technology related firms.
Switzerland’s high street retailers, similarly to the Eurozone, are
suffering from the economy and the increasing trend towards
internet shopping. The high-end retail units have remained
relatively stable however, the peripheral areas are being
affected by the change in the retail pattern.
0%
1%
2%
3%
4%
5%
6%
7%
- CHF
200 CHF
400 CHF
600 CHF
800 CHF
1.000 CHF
1.200 CHF
1.400 CHF
2010 2011 2012 2013 2014 2015 2016 2017E 2018F
Yield / V
acancy Rate
Ren
t (in
€/m
2/an
num
)
Geneva Rent Zürich Rent Geneva Yield
Zürich Yield Geneva Vacancy Rate Zürich Vacancy Rate
Source: NAI Commercial CRE
0%
1%
2%
3%
4%
5%
6%
7%
8%
- CHF
50 CHF
100 CHF
150 CHF
200 CHF
250 CHF
2010 2011 2012 2013 2014 2015 2016 2017E 2018F
Yield / V
acancy Rate
Ren
t (in
CH
F/m
2/an
num
)
Geneva Rent Zürich Rent Geneva Yield Zürich Yield
Source: NAI Commercial CRE
0%
1%
2%
3%
4%
- CHF
1.000 CHF
2.000 CHF
3.000 CHF
4.000 CHF
5.000 CHF
6.000 CHF
7.000 CHF
8.000 CHF
9.000 CHF
2010 2011 2012 2013 2014 2015 2016 2017E 2018F
Yield / V
acancy Rate
Ren
t (in
€/m
2/an
num
)
Geneva Rent Zürich Rent Geneva Yield Zürich Yield
Source: NAI Commercial CRE
37
Major Transactions 2016 - 2017
Source: OECD Data
OverviewAfter several years of deep crisis Ukraine's real estate market
recovers gradually. Improvement of macroeconomic indicators,
business activity and consumer sentiments, help to increase demand
for office, retail and logistic real estate. Thereby vacancy and rental
rates have stabilized. Nevertheless, recover of development activity
still needs more time. Decline of the main real estate indicators in the
recent years pushed down real estate prices, which has activated
interest of investors. The most active is logistic market given to low
disposal prices and high demand for warehouses from retail and
logistic companies. Also, residential property in the country stays a
popular instrument for micro and average investments given to crisis
of financial system.
Investment Volume in the Ukrainian Real Estate Market
Source: NAI Ukraine
Opportunities Investor’s interest for real estate in the country will be driven by
economic recovery: if demand and rents grow, real estate objects will
be interesting. The most active probably will stay local investors or
companies, which has experience on the Ukrainian market, while new
foreign investors will be held by countries risks.
Source: NAI Ukraine
Country Profile
Population (mn) 42.5
Capital city Kiev
Currency Ukrainian hryvnia (UAH, ₴)
Country Macroeconomic Profile (2016)
GDP $ 93.27 bn
GDP growth 2.30%
Unemployment rate 9.70%
Inflation 12.40%
Contact Details
Dmytro Korniienko
Head of Corporate Real Estate
korniienko@naiukraine.com
NAI Ukraine
Mechnikova str., 2, Kyiv,
Ukraine, 01601
+38 044 337 7677
www.naiglobal.com
0 5.000 10.000 15.000 20.000 25.000 30.000
2010
2011
2012
2013
2014
2015
2016
2017F
in mn $
PeriodProperty
TypeLocation Size (m2) Vendor Buyer
Price
(in mn)
Q2 2017Logistic
complexKyiv region 30,000
Ghelamco
GroupATB n/a
Q4 2016Logistic
complex
Brovary, Kyiv
region49,000
Secure Property
Development &
Investment plc
Temania
Enterprises
Ltd.
n/a
Q4 2016Retail -
Shopping mallKyiv 16,000
1849-Apollo
Overseas I
Limited
Dragon Capital n/a
Q3 2016
Retail -
Shopping
center
Bucha, Kyiv
region7,000
Bank 'Kyivska
Rus'n/a $1.72
Q1 2016
Retail -
Shopping
center
Kyiv 22,000 VK Development Epicenter-K $10
38
Grade A Office (@ prime location) Grade A Warehouse / Logistics
( >5,000m2 @ prime location)High Street Retail (@ prime location)
Shopping Centres
After several crisis years, the rental rent stabilized given to
increased demand and a small amount of new supply in 2016.
At the same time, there are prerequisites for ongoing demand
increase: despite absence of new foreign tenants, the existing
companies probably will continue to benefit market conditions
and improve commercial lease terms. Against this background,
the vacancy rates likely would decrease further along with rental
rates growth. Nevertheless, the overall development reduction
trend, as well as the frequent postponing of projects
commissioning likely remain in the next years.
The logistic market has shown the first marks for stabilization,
driven by improvements on retail and logistics market - the
main demand forces on the logistic property market. The first
achievements were vacancy reduction and rents stabilization.
In case of ongoing positive dynamics of macroeconomic
indicators, the logistic market forecasts for 2017 are positive
too: growth in demand, rates strengthening and vacancy
lowering.
The special event on the market in 2016 was opening of the first
super regional mall in Ukraine - Lavina mall (GLA 127,000).
This event along with the consumer’s sentiments and retail
turnover recovery founded prerequisites for further retailers
direct and franchise development on the background of quality
retail areas supply growth and loyal commercial terms. Given to
opening of Lavina mall vacancy rate went up to 9%.
Nevertheless, it is expected that vacancy will stabilize at 5% for
the year end of 2017. The next market changes occur in 2018
with the opening of several super regional scale objects.
Source: NAI UkraineSource: NAI UkraineSource: NAI Ukraine
0%
5%
10%
15%
20%
25%
30%
€ -
€ 50
€ 100
€ 150
€ 200
€ 250
€ 300
€ 350
€ 400
€ 450
2010 2011 2012 2013 2014 2015 2016 2017E 2018F
Yield / V
acancy Rate
Ren
t (in
€/m
2/an
num
)
Kyiv Rent Kyiv Yield Kyiv Vacancy Rate
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
€ -
€ 10
€ 20
€ 30
€ 40
€ 50
€ 60
€ 70
€ 80
2010 2011 2012 2013 2014 2015 2016 2017E 2018F
Yield / V
acancy Rate
Ren
t (in
€/m
2/an
num
)
Kyiv Rent Kyiv Yield Kyiv Vacancy Rate
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
€ -
€ 100
€ 200
€ 300
€ 400
€ 500
€ 600
€ 700
€ 800
2010 2011 2012 2013 2014 2015 2016 2017E 2018F
Yield / V
acancy Rate
Ren
t (in
€/m
2/an
num
)
Kyiv Rent Kyiv Yield Kyiv Vacancy Rate
39
Global Locations
Europe & Middle East
© NAI Global EMEA Region September 2017. All data contained in this report has been compiled by NAI Global EMEA Region member firms and is published for general information purposes only. While every effort
has been made to ensure the accuracy of the data and other material contained in this report, NAI Global and all NAI Global member firms that took part in this report do not accept any liability (whether in contract, tort
or otherwise) to any person for any loss or damage suffered as a result of any errors or omissions. The information, opinions and forecasts set out in the report should not be relied upon to replace professional advice
on specific matters, and no responsibility for loss occasioned to any person acting, or refraining from acting, as a result of any material in this publication can be accepted by NAI Global and/or NAI Global member
firms. 40
GeorgiaTbilisi
GreeceAthens
GermanyBerlin
Dusseldorf
Frankfurt am Main
Hamburg
Mulheim an der Ruhr
Munich
Stuttgart
Ulm
ItalyMilan
NetherlandsAmsterdam
PolandGdynia
Lodz
Poznan
Warszawa
Wroclaw
RomaniaBucharest
SwitzerlandGeneva
Zurich
SerbiaNew Belgrade
SwedenFalun
Gävle
Göteborg
Härnösand
Jönköping
Kalmar
Karlstad
Linköping
Luleå
Malmö
Mora
Örebro
Östersund
Stockholm
Umeå
Vänersborg
Västerås
Växjö
Czech RepublicPrague – Old Town
LatviaRiga
UkraineKyiv
AustriaVienna
CyprusNicosia