CBRE Evaluate Commercial Deals

Investments in Ukrainian commercial real estate in 2008 fell by 28% compared with 2007 - to 413 million dollars, says CB Richard Ellis' analytical report.

«The total investment for the last year amounted to around 413 million dollars, which is 28% less than in 2007, but 77% more than in 2006. After a sky-rocket 2007, investment activity in 2008, beginning to weaken. Although the number of transactions increased, the amount of each one is more than two times less than the average figures in 2007 - USD 32 mln. against USD 90 mln.», - mentioned in their market report.

Colliers Predict Vacancy Decreasing

According to Colliers Ukraine, they are expecting shopping centers vacancy at 10-15% level. And this is regarding Kiev. Just 1 year ago it has been unbelievable. And with it, rent rates in UAH will fall up to 30% during next 12 month.

Of course this situation is very painful for developers, particularly loaded with loans. I will not be surprised id some of them , will get bank owners. But it could an instrument for retailers for cut cost and prices, what in current situation can be only one solution for keeping sales.

Today I've seen forecast for retail turnover for 2009. These figures are terrible: we have to expect downfall either 35% or even 50% respectively if the economy won't wake up. I'm not sure in that deadly scenario, because significant part of households income is hidden for statistic. But this fall will be significant one, no way.

New personal activity

Now I provide personal negotiation support, consulting and services in RE market in Ukraine. If you interested - feel free to email me.

Flashback: Jan 09 - Feb 09 in Ukrainian RE

Due the many reason I did not post any new stuff for a while. So, I'd like to summarize some news and events in Ukraine for the past 2 month.

• Vacancy in A class office center reached 10-15 % comparing with same time at 2008. Rent rates lower as least for 30% in USD in some cases for the existing lease
• Rent rates in shopping center will drop for 10-15 % in USD next 6 month
• Residential market, especially the primary one has zero demand. So experts waiting for 30-40 % fall during 2009. Construction works are continuing only at 15% of objects-in-progress/
• Belgium IIG review their business in Ukraine, taking into instable condition in Head office.
• Nikolay Tolmachev, TMM's CEO predicts 90% level of bankruptcy in small and mid-developers.
• MOS City Group close their activity on Kiev' "Manhattan" on Rybalski island on Dnepr river
• Africa Israel stops their retail project in Zaporizhe
• Mirax is trying to sell uncomplete Mirax Plaza for USD90 mln. Maximum market price - 30 mln, funds say.
• Colliers Ukraine closed brokerage deals for more than 3000 sqm on Kiev office market
• NAI Pickard ans Metro Group Asset Management Ukraine LLC get into joint venture regarding property management
• NEST sells brand new 8100 sqm offiice center on Mechanizatorov str. But still no tenants there
• Schmidt Investors bougt A class office center "Illinsky" from Ukrsibbank co-owner Galiev
• Russians - Inteco, Sistema-Gals, Mirax, PIK go home - all activities are closed.
• East-Ukraine retaler Amstor has techical default on corporate bonds
• IKEA will start construction their first shopping centre at 3Q 2009
• OKEY seeks strategic alliance for future growth and put on the table 25% stake
• OBI has opened first own DYI in Odessa

Stay tuned!