MarketView Baltics Investment H2 2018 by CBRE Baltics

Strong investor appetite despite a moderate second half of the year.

  • In 2018 GDP in the Baltic states increased at between 3.5-4.8% level y/y. In 2019 the economies are forecasted to grow marginally slower, yet maintain above the 3.0% level, more than twice as fast compared to the Eurozone
  • In 2018 commercial real estate investment in Europe (excluding Russia) marginally increased. Investment volume reached EUR 312 bln or 0.5% more. By sectors the increase was primarily driven by offices (6%), hotels (3%), and residential (22%) assets, while the investment volume of retail (-9%) and industrial (-23%) assets both decreased
  • In the second half of 2018 investment pace into Baltics commercial real estate slowed down marginally y/y, as acquisition volumes reached EUR 371 mln. This total puts 2018 investment volumes at EUR 971 mln or 14% more compared to 2017
  • In 2018 Baltics real estate investment volume growth was driven by similar segments as in Europe. Office sector investment volume hiked 58% and other sectors increased by 45%, while retail and industrial investment volumes decreased respectively by 3% and 45%
  • Strong demand for quality assets continues to fuel yield compression. The  Vilnius prime office market observed a transaction at below 6.0%. Prime retail yields in Estonia also somewhat slightly decreased.

View full report here.