Tim Millard podcast on future of Russian property market
1 Nov, 2011, Moscow
As we wait to see if European Union has the political will to save the ground project it is interesting to consider what a negative outcome (which seems the most likely) would mean for Russia in general and for the Russian Commercial Property Market in particular.
2011 has been to date a record breaking year. Total investment in property has already
exceeded its pre-crises high of 2008 and looks to top $8 billion by the end of the year which
will make it one of the most important investment markets in Europe. Office leasing activity
has been very active led by large occupiers looking to secure future requirements at what are
historically attractive rates. Again we expect transaction volumes to top the previous height
Headwinds are mostly caused by the lack of certainty as to what will happen next, which is discouraging corporates from investing. By slowing the occupational markets and souring the general outlook this can have a knock on effect on the investment markets.
The result of the political deliberations is too early to tell as what the politicians will come up with remains uncertain. Whatever plan they unveil in the next couple of days or even beyond, that discertainty is likely to be better for the Russian market than what we have today.
Assumingly global meltdown is avoided we expect continued growth in the Russian market but value will be increasing hard to find. Those interested in the market should move sooner rather than later.
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