• 2012-05-17

Commercial real estate investment market in Ukraine is a buyer's market

Investment Transactions

In ІII quarter of 2013 on the commercial real estate market in Ukraine was not concluded any secondary investment transaction . According to forecasts of the company DTZ, the total investment on the secondary real estate market in Ukraine could potentially reach $ 800 million , significantly higher than in 2012 . In addition, it is expected that in 2014 held one of the largest transactions in the secondary market of commercial real estate investment in Ukraine in the history of the country's independence.

Most attractive for investors in Ukraine are quality retail and office property , while interest in the hotel real estate in the country a few cool compared to the dynamics of 2011-2012. At the end of January 2013 the Ukrainian company «XXI Century" repurchased 15,025 % of its shares from Renaissance Group Holding for about $ 5.4 million . Later, in February 2013 , «XXI Century " has sold 30.05 % of its shares for $ 10.3 million of DCH, which is the indirect owner Oleksandr Yaroslavsky .

In ІII quarter of 2013 investment and development company Aisi Realty Public announced its intention to acquire income -generating properties to minimize the risks by reducing the share of development projects from 100% to 50% , as well as to diversify its geographic presence .

In January-March 2013 , commercial banks continued to selectively provide project financing for the development of real estate in Ukraine , paying close attention to the reputation of the borrower and his experience in the market , credit history, as well as the quality of the financed project and the proposed collateral. In most cases, commercial banks were willing to provide funding in the range of $ 5-10 million for the period up to three years .

DTZ projects that in the first half of 2013 in Ukraine there will be a further reduction in lending in the commercial real estate sector in Ukraine, but by the end of the year the situation in the credit market may be somewhat improved.

In IIІ quarter of 2013 the most active in the secondary investment market in the segment of commercial real estate in Ukraine were Ukrainian companies and private investors with sufficient available financial resources available , as well as Russian investors . At the same time, European investors were cautious interest in acquiring assets in the segment of commercial real estate in the country.

According to forecasts of the company DTZ, for 2013 is expected to record high volume of investment transactions in the secondary real estate market in Ukraine. In the long term , with the further development of real estate market in Ukraine , there is a potential for a significant reduction of the current rate of return on real estate in the country.

In January-March 2013 initial yields the highest quality real estate in Kiev declined to 12% for office properties and to 12.5% ​​for high-quality retail properties , while for high-quality facilities and logistic warehouse rate of return has not changed , remaining at 14.5%. The recent decline in rates of return is due primarily to an increase in the interest of potential buyers to high-quality objects of office and retail properties in Kiev, generating income and put up for sale .

According to the company DTZ, in 2013 for initial yields the highest quality facilities and logistics warehouse in Kiev will not change. At the same time some reduction yields the highest quality facilities in the office and retail segments of the real estate in the capital of Ukraine .
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