Capital markets now recognise value of ESG and technology

A bifurcation is occurring in European capital markets says Skanska head of CEE divestments Adrian Karczewicz and the difference is in the level of ESG conformity and technology within buildings.

Yields for core assets have been reducing, even during the pandemic, partly because of bond yields and also due to central bank assistance for economies during the health crisis. Investors have been focused on super-core assets and have been ready to pay prices that were even more attractive for sellers than in the pre-pandemic period.

Core-plus, B-class and value-add properties have also seen some upward price movement. “In my opinion this trend may actually continue for the next couple of years,” Karczewicz told Real Asset Insight’s Richard Betts.

But he said that buildings which are technologically advanced and have good ESG conformity will now be priced much better than those that are not, even in virtually the same location.

Click on the video above to watch the full interview or listen to the podcast below.