Boško Tomašević, Managing Director SEE, CBRE – Investors in the Region Have Primarily Focused on Business Facilities, Retail and Logistics Real Estate

In most of Europe, 2023 was characterised by slower economic growth, and both companies and citizens were burdened by the effects of high inflation and a cycle of sharp interest rate increases. Due to these reasons, investment activity in commercial property also decreased. The investment markets of Central and Eastern Europe experienced a decline of 45%, or 57% cumulatively for all European markets, says Boško Tomašević, Managing Director SEE, CBRE.

He adds that we felt the effects of these developments in Southeastern Europe to a much lesser extent.

We have had a challenging year with many obstacles. How would you summarise the past year and what can we anticipate for 2024?

– Monetary policy resulted in cautious decision-making, leading to the stabilization of certain segments of the real estate market. Despite slower growth expected for European markets in 2024, capital investments in Southeastern Europe have shown growth compared to 2022, indicating continued interest with competitive yield levels. Investors in the region have primarily focused on business facilities and retail, with an increasing interest in logistics real estate.

However, the market is expected to recover in the second half of the year.

CBRE will present the challenges and opportunities of the real estate market in Southeastern Europe in the upcoming year at the traditional ‘SEE Market Outlook’ conference on 7 February. Our experts will discuss the most important aspects of the real estate market.

Have you been able to achieve your plans given the circumstances? To what extent are you satisfied with the business?

– In 2023, CBRE's Southeast Europe office celebrated its fifth anniversary, and I am proud of the team and the results we have achieved. We expanded our presence in the region by opening offices in Sofia, Zagreb, and Ljubljana. We have become the leading advisor for commercial real estate services in the region. Additionally, we have responded to market and client demands by launching two new business lines: CBRE Hotels, an integrated platform of services for capital investment in the tourism real estate sector, and ESG & Sustainability services.

Looking back to 2023, we ended the year with exceptional results from each of our business lines, surpassing last year's success.

I would especially highlight the results of the Investment Properties department, which participated in over 50% of transactions in terms of investment volume during 2023 in the region. We have provided advisory services for transaction of several assets, including Capital Plaza, a mixed-use property in Podgorica, the Belgrade Office Park business complex in Belgrade, the Situla business centre in Ljubljana, the Eurocenter business centre in Zagreb, and two NEST retail parks in Serbia.

Our success in the industrial and logistics segment this year has been remarkable, setting new records. From the largest transaction by value for industrial land in Sofia this year to extremely significant results in Croatia. Our team acted as the exclusive site selection adviser to Orbico Hrvatska in its investment in the construction of its largest distribution centre in Zdenčina. The centre covers 40,000 sqm in the first phase of the project, with the possibility of expanding capacity by a further 20,000 sqm in the second phase of the project. We provided advisory services on the biggest private investment in Osijek in the last decade, which involved constructing production facilities. Additionally, we advised on the HAVI Group's investment in the construction of their cutting-edge distribution centre in Velika Gorica. Our team supported the clients throughout the entire process, from analysing potential locations and selecting optimal solutions from a supply chain perspective, to preparing and implementing the tender process for selecting construction contractors in accordance with the client's needs, and assisting in the negotiation of lease terms, which is a time-consuming and complex process.

The Property Management department achieved a significant milestone by taking over the management of the portfolio of STOP SHOP retail parks in Serbia. The portfolio comprises 14 buildings in 14 cities, covering over 120,000 sqm, and will be managed by CBRE from 2024. Our Property Management team now manages over 385,000 square metres and 34 facilities of various types in three markets, in addition to the entire STOP SHOP portfolio in Slovenia and several logistics and business facilities.

These results confirm our ability to grow with a carefully selected team, clearly defined goals, and a focus on the needs of the market. Confirmation of our success came in the form of recognition in three categories at the CRE Awards, where CBRE was named 'Agency of the Year' in Central and Eastern Europe. This award summarises the results of the Advisory and Transactions Department in the areas of office, retail, and logistics. During the same occasion, CBRE was awarded the title of 'Project Management Company of the Year'. This year, our team successfully completed some of the most ambitious fit-out and built-to-suit projects in Serbia and the region. Additionally, we were recognised as the 'Property Management Company of the Year'.

Considering the future, which trends will impact the property industry?

– By paying attention to our clients, we predict and track the significant trends that are shaping real estate market. Based on CBRE's global research, data indicates that sustainability will have an increasingly significant impact on real estate decisions across all sectors. Various stakeholders will increasingly align with their ESG agendas, and the search for better data on the benefits and costs of implementing sustainable solutions will accelerate.

To assist investors and occupiers in meeting regulatory requirements and targets, CBRE's Southeast Europe office has expanded its services by creating a new business line ‘ESG & Sustainability Services’ in response to recent developments. Led by Slađana Popović, the newly established department will leverage CBRE's extensive network of over 600 sustainability professionals to assist clients in aligning their ESG strategies with their business objectives, corporate identity, and customer requirements.

Our approach offers customized solutions and services for each property, including ESG strategy development, Net Carbon Zero strategies, ESG due diligence, energy audits, green building certification, and GRESB reporting. We provide ESG solutions that assist in all stages of the asset lifecycle, from acquisition and development to management and disposal. Our team enables clients to make informed business decisions and manage sustainability risks in their portfolios. We aid property investors and occupiers in planning, implementing, and measuring efforts to reduce their carbon footprint and build a sustainable future.

What will you focus on when planning your business in 2024?

– In addition to achieving business results, it is crucial to me that we prioritize creating a positive work environment and developing our employees. Our team has grown significantly since 2018, when we had only 34 employees. We now have over 100 team members, which is a testament to our business development and our reputation as an employer that supports professional growth across all sectors. The reflection of our business culture, which places employees at its center, is evident in the fact that 80% of the team that started in 2018 remains with us, forming a strong foundation for our business.

In 2023, we appointed Ivana Rajković Špes as Country Head Croatia, and our Advisory & Transactions Office team received significant support from experienced professionals in Zagreb and Sofia. Significant reinforcements have also been added to Property Management and Retail Leasing team in Serbia indicating further development of our business.

CBRE's exceptional results in the region year after year, which are reflected in the largest market share in all business activities, are the result of local business knowledge combined with the experience and resources of the global CBRE network. However, this achievement would not have been possible without the individuals who comprise CBRE. Therefore, I am particularly grateful to each team member for their unwavering commitment.

CBRE d.o.o. Beograd

CBRE

Boško Tomašević

Slađana Popović

Ivana Rajković Špes

CBRE Hotels

consulting ESG services

NEST retail park

Agency of the Year

STOP SHOP retail parks

GRESB reporting