The first quarter of 2017 closed with a mere €475 million of transaction volume, which is slightly lower than in the corresponding period of last year. Still, on a 12-month rolling basis, the market recorded a lift by 12.5%, reaching €4.58bn. With a solid pipeline of deals pending and a number of investors interested in various types of assets, 2017 is likely to show strong performance in terms of weight of capital and property values.
Hotels ride the wave
In the first three months of the year hospitality sector attracted an unprecedented volume of investment reaching €240m and accounted for 48% of the overall market share. Considering the strong interest, this trend is likely to continue in the mid-term horizon.
Warsaw remains the top target
Investment products in the capital and within the Warsaw agglomeration invariably attract the greatest interest from investors. In spite of the fact that in many cases regional cities offer more attractive cap rates, Warsaw remains the location of first-choice. Regional markets attract both opportunistic investors as well as those less likely to take risks and it is products that present opportunities for creating added value through proactive management, revitalization and repositioning that are highly popular there.
Plethora of investors’ nationalities
REITs are getting real
With the successful IPO of Griffin Premium RE on the Warsaw Stock Exchange, the chances to activate Polish capital to invest on the real estate market have significantly increased. The total value of the IPO amounted to approx. €118 million, bringing market capitalization to around €206 million. Shareholders include institutional and retail investors from Poland as well as international institutional investors such as EBRD.
As regards REITs, the domestic investment market is eagerly awaiting the development and adoption of unambiguous and sustainable legal provisions. REITs constitute an extremely effective instrument that has for many years successfully functioned in the West. Their simplicity and high profitability would generate stronger interest in the capital market from investors and even attract new ones. We know today that two, and maybe even three, debuts of new REIT companies will be taking place on the Warsaw stock exchange by the end of this year
Anna Staniszewska, Head of Research & Consultancy, CEE
Head of Marketing & PR, Central & Eastern Europe BNP Paribas Real Estate Poland