Warsaw in fourth position in ULI report
In the report's 'markets to watch' category, Eastern and Central European countries were ranked the highest for investment opportunities, mainly because they still have a lot of ground to make up on Western Europe; Moscow, as the least developed market, came top. Sixty percent of the respondents recommended buying property there and only 25 percent selling it. Warsaw, lower down the list in fourth, nonetheless drew a more positive response, with 61 percent suggesting that property there should be acquired and 10 percent that it should be sold.
The inward investment and income growth that Central European countries' accession to the European Union is already fostering, and their future entry into the Eurozone, has made the capitals of Prague, Budapest and Warsaw, attractive propositions for investment. Though yields have been converging with the EU for some time, there are still attractive premiums to be had as well as the prospect of further convergence in the medium term. 'Entry into the Eurozone will reduce interest rates and put pressure on yields,' states the report.
One disadvantage that the market in the region has is that vacancy rates have gone into double figures and rental growth is unlikely to be significant for some years to come, due to the high level of rents relative to the cost of other inputs in these economies. Office rents, however, are stabilizing in Prague, Budapest and Warsaw after falling for five years in response to the explosion in development during the nineties.
'The best bets,' for the region, concludes the report, 'are probably in the development of retail centers, residential space and hotels.'
The inward investment and income growth that Central European countries' accession to the European Union is already fostering, and their future entry into the Eurozone, has made the capitals of Prague, Budapest and Warsaw, attractive propositions for investment. Though yields have been converging with the EU for some time, there are still attractive premiums to be had as well as the prospect of further convergence in the medium term. 'Entry into the Eurozone will reduce interest rates and put pressure on yields,' states the report.
One disadvantage that the market in the region has is that vacancy rates have gone into double figures and rental growth is unlikely to be significant for some years to come, due to the high level of rents relative to the cost of other inputs in these economies. Office rents, however, are stabilizing in Prague, Budapest and Warsaw after falling for five years in response to the explosion in development during the nineties.
'The best bets,' for the region, concludes the report, 'are probably in the development of retail centers, residential space and hotels.'
