by Property Forum | Report

According to Colliers, CEE investment flows are down by almost 48% on Q1 2020, at ca. €2.0 billion. Despite the slow start, 2021 year-end volumes are estimated to accelerate to reach similar levels to 2020, of around €10.0 billion.


Kevin Turpin, Regional Director of Research | CEE explains: “As the pandemic continues to impact on capital markets, CEE investment flows are down by almost 48% on Q1 2020, at ca. €2.0 billion. Despite the slow start, we currently estimate that CEE 2021 year-end volumes will accelerate to reach similar levels to 2020, of around €10.0 billion. Preliminary EMEA volumes are estimated to be down ca. 32% y-o-y.”

Kevin Turpin

Kevin Turpin

Regional Director of Research | CEE
Colliers International

Kevin joined Colliers in October 2019 as the Regional Director for Research in CEE and has been working in the commercial real estate industry in the field of property market research and consultancy for over 14 years. The research and consultancy team consists of 18 research analysts, covering numerous markets across the CEE region. Kevin’s role is responsible for the delivery of market research and insights to both Colliers clients and its business lines. Kevin and team research and advise on all market sectors with a key focus on offices, retail, industrial & logistics and investment. Kevin's previous roles have been in the HR consultancy, information technology and public sectors, where he has gained valuable international experience working with people, technology, business and finance. More »

Poland captured ca. 65% of all volumes, followed by the Czech Republic and Hungary with 14% and 11%, respectively.

CEE flows by sector 

Offices secured 50% of the total transaction volume, followed by Industrial and logistics (28%) and retail (11%). Pricing remained relatively stable overall, but further compression in the industrial and logistics sector is expected throughout the year, subject to transactional activity which will, in turn, rely on product availability.

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CEE investment volume growth rates

All countries in the region recorded year-on-year declines in volumes compared to the first quarters of 2020, except for Hungary, and 2019, except for Poland. Despite the slow start, investor sentiment suggests a strong pick-up in activity in H2, subject to progress with the pandemic and open travel.

Q1 2021 prime yields (%) & 12-month forecast

Colliers has recorded very little movement in prime yields, primarily due to the ongoing lack of transactional evidence to support further shifts. “Our view remains that while some shifts are inevitable, core, well-performing assets should hold up well, with more pressure on secondary product. Due to the high levels of interest from investors in logistics assets, we expect to see further compression in this asset class” adds Kevin.

CEE flows by origin of purchaser

Western and Northern European funds have dominated the first quarter of 2021, accounting for 50% of volumes, with capital coming mainly from the UK and Germany. CEE domestic investors, consisting of mainly Polish, Czech and Hungarian capital, have also remained very active, particularly in their own respective domestic markets. While travel restrictions challenge the ability for many investors to view opportunities and dampen investment volumes, capital from Singapore and South Africa managed to deploy.

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Key economic indicators

Subject to the pandemic being brought under control and allowing economies to function with fewer restrictions, CEE economies are expected to begin recovery throughout 2021 and 2022, at an average pace of ca. 4.3% annually. Unemployment rates have risen during 2020, although perhaps not as high as some would have expected. As a result, this has reflected well on the outlook for growth in retail sales, which will hopefully deliver some much-needed positivity to retailers and the property sector.