According to Cushman & Wakefield, the volume of investments in commercial real estate in Russia in 2019 will approach 3 billion euros. The most popular objects will be stabilized shopping centers;(opened more than 2 years ago, with low vacancy, high traffic and loyal audience), as well as high-quality, tenant-filled office facilities.

Commenturet Sergey Ryabokobylko, Managing Partner, CEO Cushman & Wakefield: "Despite the fact that the investment market is small today and the total volume of investments in commercial real estate in Russia, according to preliminary data, will only slightly exceed 1 billion euros in 2018, it is worth noting that the exodus of foreign investors from Russian real estate has actually been completed. The locomotive of the market today is Russian investors, including those who have not previously invested in commercial real estate. The second source of capital in the Russian commercial real estate market is money from the CIS countries. The Russian market is not just an understandable investment object, but a fairly modern and developed capital management mechanism.To some extent, for our closest neighbors, Russia plays a role similar to that played by Western Europe for Russian investors.

According to the company, in 2017, the net outflow of foreign investment from commercial real estate in Russia amounted to about 500 million euros, this year only 5 million euros . This means that the Russian market of supply and demand in commercial real estate is balanced today. At the same time, the profitability of the Russian market is much higher than that of its Western neighbors. At the moment, the profitability of commercial real estate in Russia is about 10%, while Western Europe rarely offers a yield higher than 4%.

Investors are particularly interested in new real estate formats and modern approaches to use. This also applies to the format of flexible office spaces, and food halls in trade.However, such objects do not yet occupy a significant share in the total structure of investments in commercial real estate, and this is typical not only for Russia, but also for more developed Western markets.

Source: Cushman & Wakefield

Photo: shutterstock