‘CEE real estate will stand out in a weakening world economy’

Bad news for the global economy is good news for CEE, delegates heard at Real Asset Media’s Outlook 2020 – Europe & CEE investment briefing, which was held at Colliers International’s Warsaw office earlier this month.

‘We have a bleak outlook for the world economy and we don’t believe that global growth will recover in 2020,’ said Dan Bucsa, Chief CEE Economist, UniCredit Bank. ‘In this context, CEE stands out because it is more stable and strong than other emerging markets’.

Dan Bucsa, Chief CEE Economist, UniCredit Bank, Paul Hallam, Managing Partner, GalCap Europe, Justyna Kedzierska-Klukowska, Head of Berlin Hyp Warsaw Office, Berlin Hyp AG, Piotr Mirowski, Senior Partner, Director, Head of Investment Services, Colliers International, Poland and Peter Noack, Co-Founder and Managing Director, ZEITGEIST Asset Management discuss the Outlook for the Real Estate Investment market in the CEE Region.
Filmed at the CEE Outlook Investment Briefing, Warsaw, January 2020 by Real Asset Media.

There is little upside for the dollar so it makes sense for investors to put their money into euro-linked assets, he said: ‘The region is seen as a euro proxy. Real estate in CEE is a real alternative to bonds, so we expect more international capital to flow into the region’. 

The prediction is that CEE will outperform other regions this year, with Poland doing best in terms of economic growth. GDP is set to increase by 3% as the country benefits from strong domestic demand. ‘Poland is less dependent on exports than Hungary, Slovakia or Czech Republic and that will turn out to be an advantage this year’, Bucsa said.

It will be business as usual in the region in 2020. ‘The lack of other options for investors means that, despite the weakening economic context, money will continue to pour into CEE real estate’, said Piotr Mirowski, Senior Partner, Director, Head of Investment Services, Colliers International.

International investors that have already discovered the region will stay, but CEE will also attract new capital from different areas of the globe.

‘We are seeing newcomers to the market,’ said Justyna Kedzierska-Klukowska, Head of Berlin Hyp Warsaw Office. ‘We are having talks with Scandinavian investors who so far have only had a presence in Western Europe’.

Australian and Canadian investors have also been looking around, as well as Asians, especially from Singapore, China and Malaysia. South Koreans, who made a splash last year, are likely to cash in in 2020. 

‘Everyone is obsessed with Asian investors, but they haven’t seen the Latin American investors yet and, trust me, they are coming because they think this is a region that will give them a very stable return’, Bucsa said. 

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