The slowdown in commercial property investments in Central and Eastern Europe has led to the lowest volume transacted since the third quarter of 2009, according to the latest data from CBRE. The total investment volumes amounted to just €600m in the first quarter of 2012, due to a lack of financing and the narrowing investor requirements. The Polish market was the most active in Q1 2012, while the only investment of note in Romania was the sale of City Business Centre in Timisoara to New Europe Property Investment. Another significant transaction was the sale of a Prologis portfolio acquired by Hines Global REIT, which included Polish assets.
“Continuing pressure on real estate finance has resulted in a significantly changed spectrum of active real estate financiers across CEE,” says Jos Tromp, Head of CEE Research & Consultancy, CBRE. “The most active financiers are focused on Central Europe with Poland and the Czech Republic standing out clearly. However, bank requirements regarding margins and ratios combined with a general risk-averse outlook are restricting deal flow to the prime end of the market even in these markets. Standing investments are clearly favored with development financing increasingly challenging to obtain, a factor which is already significantly affecting the development pipeline across CEE.”
