Czech lucrative properties such as hotels, offices, and shopping centres are now heading into the hands of domestic investors. On the other side, foreign investors are gradually leaving the market, reports seznamzpravy.cz.
The largest domestic shopping centre – Prague’s Palladium – will be purchased from the German investment company Union Investment by the Czech real estate fund Reico, which is the number one on the market. Another major transaction was the acquisition of the most luxurious hotel in the Czech Republic – Prague’s Four Seasons – by the largest domestic investment group, PPF. Other significant recent transactions include the sale of the Visionary office building in Prague’s Holešovice to the Conseq group or the change of ownership of Stará Celnice in the centre of Prague, which was acquired by Fio realitní fond.
“Domestic investors account for approximately eighty per cent of real estate transactions in the Czech Republic. Czech capital clearly dominates our market,” emphasises Zdenka Klapalová, Managing Director at Knight Frank.
According to experts, the dominance of Czech money will continue for the rest of the year. "We expect the share of domestic capital to exceed eighty per cent for the whole year," says Katarína Brydone, Director at Colliers. On the other hand, foreign investors are now on the sellers' side. According to Brydone, transactions worth €3.5 billion will take place on the domestic investment market for the whole year.
This trend is due to a mix of several factors. One of them is the fact that foreign investors are now taking advantage of opportunities in their home markets. "There has been a more significant price correction in Western Europe, so new investment opportunities are opening up there," explains Klapalová.
There is also a difference in investors' approach to real estate funds. While not as much money is currently flowing into foreign funds due to problems in the European and American real estate markets, in the Czech Republic, they are still a popular type of investment. Czechs simply still like to put money "in bricks".
