Investing in square meters
Commercial real estate in Russia brought in more investments in 2019 than the year before. The retail property is leading again. SCRussia singles out the main trends and preferences of the investors.
Investments are on the rise
Analytics are still summing up the year 2019, and the final numbers are just yet to come, while it is clear that the volumes are up over the numbers of 2018. CBRE was expecting a 1.4 increase up to 250 billion rubles, and Knight Frank to 270 billion rubles. The stable microeconomics (the main key indicators either confirmed the positive outcast or showed even better results) motivated the investors. The interest rate cut by the Central Bank of Russia to 6.25%, which is now at its lowest since 2014, provides opportunities for improved conditions for borrowing money, which also drives the behavior of the investors, notices CBRE.
An average amount of an investment is up too, from 1.7 billion rubles in 2018 to 2.4 billion rubles at the end of 2019. What is interesting is that investors have turned to unfinished
construction, construction sites with projects, ongoing construction, redevelopment projects, while a year ago they were mostly interested in finished projects with stable cash flow. The amount of investments into this type of real estate is 80 billion rubles (34% over the numbers of 2018).
As we wrote in our December issue, shopping real estate has been leading third year in a row, followed by offices (25% of the market), housing (21%), warehouses (13%), hotels (7%). Most investments are still focused on Moscow, while the share of St. Petersburg has risen. As for regions, their stable investments are at 5–7%.