Polish Property Market Leading The Recovery Charge
News Posted On: 15 February 2010
When MGPA -- a real estate company backed by Australia’s Macquarie Group -- acquired two Polish shopping centres with an option to buy a third for more than €235m ($341m), last month, it signalled that the beginnings of a rebound started late the year before were set to strengthen in 2010.
The Polish property market is leading the drive to recovery based on the fact that the economy never saw recession during the crisis.
However, analysts are warning that the recovery is fragile, with most buyers focussed on only the Czech Republic and Poland, and only on prime office and residential spaces. Meanwhile in places like the Baltics, that saw severe recessions, which they are still struggling to claw their way out of, the property markets remain badly depressed.
Sylvia Gansser-Potts, director of property at the European Bank for Reconstruction and Development, said: “There’s not a lot of activity because investors are still sorting out portfolios and banks are reluctant to lend. But there has been an improvement over the last quarter. Poland stands out as the most attractive country. But other countries, such as the Baltic states, are another story.”
Around the world property investment funds in their various shapes and sizes have made a fortune on commercial properties bought cheap in depressed markets. Now that prices are swinging back up and potential profits getting smaller, there is also fear that this will start to weigh downward on demand.
Poland however stands out as an example of excellent economic management, and investors are currently flocking there because of the increased faith and confidence in the market. It will take something major to dent this demand with investors main concern today being safety and stability rather than maximising gains.
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