CEE companies are adapting fast to changing market trends and demands, delegates heard at Real Asset Media’s Outlook 2020 – Europe & CEE investment briefing, which took place in Budapest recently.
‘We are mainly a shopping centre developer, but that business is very limited now, so we have changed our strategies to focus more on mixed-use, office and residential, while some of our competitors have gone into logistics,’ said Tom Lisiecki, CEO, Member of the Board, TriGranit.
‘New asset classes are coming up that didn’t exist before, like residential for rent as an institutional business, so we want to get into this trend from a development angle’.
Alternatives are emerging but offices continue to be the most sought-after assets, with strong occupier demand and rising rents in the capital cities.
‘Offices are the dominant investment because demand far outstrips supply,’ said Luke Dawson, Managing Director & Head of Capital Markets CEE, Colliers International.
‘Quality educated labour is still dramatically cheaper here than in Western Europe, so there is still a great advantage for companies to come here,’ said Noah Steinberg, CEO & Chairman, WING.
Competition for talent has contributed to a marked improvement in the quality of the buildings, as the work environment has become as important as salary in determining employees’ choices.
‘The quality and amount of thought that goes into building now is incredible, because there is a tenant-driven demand for smart, healthy, sustainable buildings and for technological solutions’, said Zinaida Onczay-Vojnár, Partner & Head of Real Estate, Considero Investments.
‘The buildings here are just as good here in Budapest or Bucharest or Warsaw as they are in Frankfurt or Dusseldorf, but rents have yet to catch up,’ said Thomas Frater, Founder & CEO, Hussar & Co.
The trend for flexibility has also reached CEE, as tenants use the space differently. ‘A co-working occupier in our space can be a safety-valve for the operators, so we will have them in all our developments,’ said Lisiecki. ‘We use it as a plus to tell tenants that there is flexibility in the space, so that they can ramp up if necessary’.
Transformation is on-going and the region is moving in the right direction, said Steinberg: ‘We feel very strongly that we are in the right place. CEE will be the best part of Europe in many ways for the next decade’.
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