2014-03-05 10:40:52 - Volume of property investment transactions reached precrisis level and is expected to beat the record in 2014 already. Spectacularly recovering demand forces new developments in both commercial and residential sectors. The mid term economic potential for Lithuania, Latvia and Estonia is robust, thus expecting to bring more activity and reinforce the Baltic position in the European property map.
According to Newsec - the Full Service Property House in Northern Europe - 2013 was a real RESTART for the Baltics.
All three Baltic countries have continued demonstrating one of the best growth results and shape of government finance within the EU, continuously rising private consumption as well as retail trade, stable growth of consumer and business confidence. Economy growth is continuously fuelled by increasing exports and strengthening domestic demand. All 3 countries are expected to be among the most rapidly growing economies in Europe within short and mid term. The currency risk is no longer a risk for businesses and investors - Latvia and Estonia are in Eurozone already, while Lithuania plans to adopt Euro in 2015.
Newsec experts say,
that private consumption has a more significant role in economic development and the retail trade in the Baltics continues accelerating the fourth year in a row. Turnovers of the most succesfull shopping centres grew by 8-15% per annum and current occupancies are at 97% -99%. Entry of new retail chains, like H&M, IKEA shows the confidence of the Baltic markets and accelerates interest from other solid international players.
Vacancy rates of office buildings has dropped significantly since 2009, thus enhancing development of new buildings. Average A class vacancy rate decreased from 5% to 2% and now is at the critically low level. International occupiers like Barclays, Danske Bank, Western Union and others keep enjoying from perfect combination of labor quality and costs and are the most important occupiers of new buildings; while rapidly growing small and medium businesses prominently occupy all types of office facilities all around the major Baltic towns.
Global trends attract investors’ interest towards good logistic properties. 25% of investment transactions have been closed in the field of logistic assets in 2013. The modern logistic centres are fully occupied and the new developments take place.
Baltics – back on track? Yes. Please read the full copy of Baltic Property Market Report 2014 to find more details.