WARSAW, 22 July 2016 – According to JLL, the volume of real estate investment transactions concluded across Central and Eastern Europe in H1 2016 amounted to approximately €5.1 billion. Poland accounted for 2.07 billion, followed by the Czech Republic (€950 million), Hungary (€910 million), Romania (€340 million) and Slovakia (€310 million). SEE (other CEE) markets registered €540 million in finalized deals.
Stuart Jordan, Head of CEE Capital Markets at JLL, says: "The volume of real estate investment transactions concluded in the CEE region in H1 2016 totalled €5.1 billion. This represents a 69% increase over the same period last year and is the best H1 performance in CEE real estate investment volume since 2007. Investor interest in commercial projects remains strong, and as a result, we expect the total volume of transactions for 2016 to exceed €10 billion”.
Poland – the leading investment location in CEE
Agata Sekuła, Head of CEE Retail Investment at JLL, comments: “Poland attracts investors thanks to the scale and transparency of the market and the country's good economic performance. The volume of real estate investment transactions concluded in Poland in H1 totalled €2.07 billion, comprising €1.02 billion in retail, €786 million in offices and €261 million in warehousing. The full range of investors - from core to opportunistic - is active in the Polish market. It is also worth noticing that deals ranging from small single assets to complex platform transactions were concluded in H1”.
Poland's headline deal in H1 2016 was Redefine's acquisition of a 75% stake in the Echo Investment commercial platform in Poland, including retail schemes (Amber in Kalisz, Galaxy in Szczecin, Galeria Echo in Kielce, Galeria Olimpia in Bełchatów, Outlet Park Szczecin, Pasaż Grunwaldzki in Wrocław, CH Echo in Przemyśl and Bełchatów, Galeria Sudecka in Jelenia Góra and Galeria Veneda in Łomża), and office projects (A4 Business Park in Katowice, Astra Park in Kielce, Malta Office Park in Poznań, Oxygen in Szczecin, Park Rozwoju in Warsaw or West Gate in Wrocław).
Other notable retail transactions in H1 2016 in Poland included the purchase of CH Krokus in Kraków by Mayland from Valad, acquisition of Ferio in Konin by Union Investment from Rockspring and CBRE Global Investors' acquisition of Galeria Jantar in Słupsk from Tristan Capital Partners. Prime retail yields stood at 5.00%.
Notable Warsaw office transactions included Warburg-HIH Invest Real Estate purchasing Prime Corporate Center from Golub GetHouse, the acquisition of Zaułek Piękna by GLL from Invesco, and Valad’s purchase of Wiśniowy Business Park (C,D,E,F) from Peakside Polonia Management. Prime office yields in Warsaw stand at 5.0-5.25%.
Interestingly, 60% of H1 2016 office transactions in Poland was concluded in regional markets. Key deals (apart from the abovementioned transaction between Echo Investment and Redefine) included: the purchase of Allcon@park in Gdańsk by Intel from Allcon Investment, the sale of the second phase of Alchemia in Gdańsk by Torus to PHN, as well as the acquisition of Hines' office portfolio (Sterlinga Business Center in Łódź and Neptun Office Center in Gdańsk) by GTC. Other regional office transactions worth mentioning are: the acquisition of Aleja Pokoju 5 in Kraków by Warburg-HIH Invest Real Estate from Buma Group, and Benson Elliot/Sharow Capital's acquisition of Opera Office in Gdańsk, Okraglak i Kwadraciak in Poznań and Forum 76 in Łódź. Starwood completed the purchase of office building FIVE (part of Quattro Business Park) in Kraków from Buma Group, and GTC acquired Pixel in Poznań from Garvest Real Estate.
The largest warehouse transactions included: the NBGI portfolio acquired by Hines REIT, Annopol Business Park sold by ECI to Hines REIT and GLL’s acquisition of the Amazon Fulfillment Center in Poznań. Prime warehouse yields stand at 6.75% with further compression forecast, while exceptional, long leased assets are trading well below 6.00%.
“Investor activity in Poland remains buoyant. We expect the total annual volume of real estate investment transactions to be in line with last year's result at about €4.0 billion”, Agata Sekuła adds.
In H1 2016, experts from JLL were involved in numerous real estate investment transactions in Poland, including sales and acquisitions of: 75% stake in Echo Investment's commercial real estate platform in Poland (sell-side advisory to Echo Investment, controlled by Griffin, Pimco and Oaktree funds), NBGI logistics portfolio (sell- side advisory to NBGI), Prime Corporate Center (sell -side advisory to Golub GetHouse), Wiśniowy Business Park (C, D, E & F) in Warsaw (buy-side advisory to Valad), Zaułek Piękna in Warsaw (sell -side advisory to Invesco Real Estate), Warsaw Corporate Center in Warsaw (sell- side advisory to MEAG), Opera Office in Gdańsk (sell-side advisory to EURO STYL), Okrąglak and Kwadraciak in Poznań, as well as Forum 76 in Łódź (buy -side advisory to Benson Elliot / Sharow Capital), Pixel in Poznań (sell -side advisory to Garvest Real Estate), Neptun Office Center in Gdańsk and Sterlinga Business Center in Łódź (buy-side advisory to GTC), FIVE (part of Quattro Business Park) in Kraków (sell -side advisory to Buma Group), as well as Ferio Konin (buy- side advisory to Union Investment), CH Krokus in Kraków (buy- side advisory to Mayland), Galeria Sandomierz (sell-side advisory to Euro Real Estate Investments LLP), or a retail park in Zabrze (sell- side advisory to Plan 40 Sp. z o.o.).
 Russia not included