Investment flow into the CEE-6 real estate arena is some -21% lower than the Q1 record set in 2018. The Q1 2019 CEE Investment Scene infographics presents the breakdown of the EUR 2.3bn of capital deployed into the CEE-6 countries thus far this year. The most significant factors in the decline are lower flows in Poland (-60% year-on-year) versus a strong Q1 2018 and extreme weakness in the retail sector, with CEE-6 volume just EUR 161mn in the quarter versus EUR 2.03bn twelve months ago.
Mark Robinson, CEE Research Specialist, Colliers International adds:
“The bright spots are that Czech deal flow is back up to the quarterly run rate seen in 2016 and 2017, the CEE-6 office volumes of EUR 1.25bn and a near-record quarter in the hotel sector (EUR 459mn of purchases made). West European funds were net buyers in Q1 2019, US and UK funds remained net sellers. East Asians were still buyers and domestic money remains active”.
Flows by origin of purchaser and origin of vendor in Q1 2019 (%):
“Two-speed” GDP dynamics are emerging across much of the global economy, with manufacturing slowing and services continuing to grow. Does this pattern repeat in the CEE-6 countries? Slowing momentum in Q1 industrial production is evident in the Czech Republic and Romania. Manufacturing growth remains healthier elsewhere in the region. Supported by wage dynamics, Q1 retail sales growth is more robust across most of the CEE-6, except in Slovakia and Bulgaria.
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