REBEC 2021: Why is there a boom of apartment building in capital cities and what are the top investment destinations?

Apartment building is flourishing in the capital cities of the region, and the reason lies in the attractiveness of apartments. That is why such projects in capital cities are very important and big, according to George Bobvos of TriGranit, a participant in the “Regional Investment Hot Spots” panel held within the REBEC 2021 hybrid event.

– This is a global trend, which is shocking, because the demands cannot be met. They are pronounced, regardless of Covid-19. We are talking about Warsaw, Prague, Bratislava, Budapest, Zagreb and Belgrade. It’s not good for big projects to be concentrated in capital cities, but that is what’s happening – he added.

He also mentioned the differences in the price of floor area per square meter, which range from 4,000 to 14,000 euros in Europe, from the Czech Republic, through Hungary, to Germany.

He especially emphasized the construction of buildings meant for apartment renting, for those who can’t afford to buy them.

– Co-living is a trend that will last for a long time, because the possibilities of purchasing real estate are small. After Covid-19, many former hotels might turn into apartment buildings. The idea is great, but people from this field believe that the market will come back and find it difficult to consider a transformation of their business. This is happening in Denmark and Germany, because the locations are remarkable, and there’s less space for further development. These buildings can be potentially transformed and repurposed – Bobvos said.

When it comes to German investments, he says that the difference between the EU states and those outside the Union is apparent and that, for that reason, Serbia is handicapped in a way. He also adds that Bulgaria is not handicapped that way, but that it is too small.

– Investors test these countries through pilot projects and they decide whether to make further investments or give up on them. Investors from English-speaking countries are busy at home and don’t pay that much attention to Southeast Europe – Bobvos notes.

Still, he notes the interest of Chinese investors in the region, but also the appearance of new types of investors: funds, foundations, family investors, who are looking for real estate projects in Central and Eastern Europe.

– Bucharest is the next top destination for apartment building, and Belgrade is close – George Bobvos believes.

He adds that they need to adapt to the needs of the market and be open to new trends.

– Circular economy, green and sustainable products are coming – Bobvos believes.



Luke Dawcon of Colliers International talked about the return to the offices, but also the development of retail parks, which he believes will not disappear as a concept. He pointed out that, in the period following Covid-19, good locations and long-term planning will be the most important.

– The Czech Republic is the most expensive market in Central and Eastern Europe, and Prague and Warsaw are the most expensive cities when it comes to offices, The Hungarian market is active when it comes to offices, the lease rate is growing and there’s a demand. In Serbia, aside from Belgrade, and in Bulgaria, there is not much trading of office space – Dawson said.

He also said that more local investments were needed and that investors were interested in the safety and the size, “which they currently can’t find in Central and Eastern Europe”.

– It’s necessary to have a development platform. It’s important to think in terms of whether a facility, currently under construction, can be sold in the future, whether it can meet the future criteria, especially when it comes to logistics and energy efficiency – Dawson said.

He concluded that there was an increasing demand for buildings with additional amenities, such as gyms and similar facilities.

Aleksandra Kekic

Trigranit doo Beograd

Colliers international d.o.o Beograd

TriGranit

Colliers International

George Bobvos

Luke Dawson

Rebec

Rebec 2021

Warsaw

Prague

Bratislava

Budapest

Zagreb

apartment building

retail parks

offices