In the first quarter of 2024, capital in a total volume of about EUR 545 million was invested on the Czech market, which represents a year -on -year increase of 36 % and more than three times compared to the previous quarter (fourth quarter of 2023). This is an excellent result compared to the 15% decrease in the entire CEE market. Meanwhile, the dominance of local investors, respectively. Investors from the region of Central and Eastern Europe. One of the most important transactions of the first quarter of this year was the sale of the Arcade Pankrác OCs and the sale of 50% share in the portfolio of CPI PG hotels.
While the purchase price of the Arcade Pankrác of 40,000 m2 was approximately EUR 270 million with a revenue slightly higher than our reported "Prime Yield" for Prague shopping centers, a 50% share in the eight Hotel PG Hotels , which, among other things, demonstrates the confidence and resistance of the Czech real estate market, including the hotel sector.
Revenues from “Prime” real estate are currently stable
“In terms of reference Prime revenues on the Czech investment scene, in the first quarter of 2024 there was no significant movement in any of the main classes of assets, and we do not believe that any of the recent investment transactions would revise our current attitude to the amount of revenues , ”Comments Josef Stanko, Senior Analyst from Colliers, adds:“ In our opinion 25 %. In the case of various partial retail segments in the Prime segment, the yields from High Street real estate are 4.50 %, 6.00 %shopping centers and the best retail parks at 6.25 %. "
According to Statek, the mood on the market remains variable. Some investors with whom Colliers have negotiated with that prices on the Czech market have not yet been fully recruited, and expect further decrease in capital values. On the other hand, it is not surprising that the owners or seller of real estate express rather an optimistic view of their properties. Despite the different views of pricing, Colliers' experts believe that the difference between supply and demand is beginning to shrink, which should support transaction activity for the rest of the year 2024. Another factor to be taken into account is the expected future costs of Debt financing. Due to
This year, the expected reduction in the basic interest rates by the ECB could make such a step easier and help reduce the price difference.
Expectations grow but will take a long time for the market to strengthen
With each next month, various assets, such as the lucrately located multifunctional building Myslbek in the center of Prague, the office center of the Hradčanská company S-IMMO in Prague 6, the portfolio of the Nova Real Estate selling 16 assets and even several so-called Sale & Leaseback (back rent) of industrial properties found in or near regional cities.
Obviously, real estate owners seek to present such opportunities that could arouse investors' interest in the market or even attract those who are standing aside. However, the profile of many of these potential transactions could be described more like Value-AD or as an opportunistic investment, and therefore rather attract established local investors who are willing to take long-term risks such as repositioning buildings or their reconstruction.
“With regard to the results of the first quarter, we assume that the volume of transactions in 2024 will reach EUR 1.4 billion. Such a result would thus stop the year -on -year decline in the total investment volume recorded in the last three years. This in itself may indicate that the Czech real estate investment market is reflected from the bottom, ”says Josef Stanko, saying that, despite growing expectations, a few more quarters will last before the market actually increases.
