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Commercial real estate down but big players still investing

The latest figures from analysts Jones Lang La Salle show that just like the home property sector, commercial property is on the slide. Overall sales have dropped by 46% worldwide and even the most optimistic prediction is that they won't start recovering until sometime in 2009.

But those with the money are still investing. They still favour the US but interest is in increasing in China, according to figures from the Association of Foreign Investors in Real Estate.

India, Russia and Mexico are strong contendors but it is little Bulgaria that is the surprise. Although not capable of the kind of massive investment seen in these larger countries the value of major deals struck on the Bulgarian commercial property market rose 35% in the last year to €878 million.

In terms of which cities are seeing most movement New York came out on top followed by Washington, London, Paris and Shanghai. 'Those who rely less on borrowing are leading the way,' says the AFIRE.

But it is in Eastern Europe that canny commercial investors ought to look according to international consultants CB Richard Ellis. Its research has found that last year Bulgaria witnessed 40 large deals, 15 of which referred to office buildings and 10 to commercial buildings.

One of the most important deals were the management buyout of Landmark, the Sofia Airport Centre development of Tishman International and GE Real Estate, as well as the mixed-purpose project of Urbas Guadahermosa on a site near Sofia's central rail station.

Investors expanded the geographical scope of their interest in 2007.

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