Recovery in Ukraine’s real estate market: How is it going?

13
Nov
2024
News - Recovery in Ukraine’s real estate market: How is it going? #construction #rebuilding #report #Ukraine #war in Ukraine

by Property Forum | Report

Recovery in Ukraine began after the first months of the war. Without waiting for the war to end, the authorities and the population decided to restore both civilian and commercial facilities that had been damaged or destroyed during the hostilities. Today, this is a well-controlled and organized process of reconstruction and renovation, funded by the state, along with the help of international organizations, and by the population's efforts in the case of damaged housing. The Ukrainian Real Estate Club has collected information on specific areas of reconstruction for Property Forum, from the restoration of critical infrastructure to socially oriented projects such as schools and medical facilities.


Data on damage 

According to the official data, from February 24, 2022, to February 2024, Russians destroyed more than 213,000 objects in Ukraine. The housing and utilities sector, as well as trade and industry, transportation, agriculture, and energy, suffered the most. Kharkiv and Donetsk regions are the most heavily damaged. Each of them has more than 44,000 damaged objects. This is followed by Kyiv, Kherson, Luhansk, Zaporizhzhia and Mykolaiv regions. Ivano-Frankivsk, Chernivtsi, Volyn, Zakarpattia, and Ternopil regions were the least affected.

According to the World Bank, 10% of Ukraine's housing stock has been damaged or completely destroyed by Russian shelling.

The State Register of Destroyed and Damaged Property contains more than 290,000 objects. Of these, according to the Ministry of Community, Territorial and Infrastructure Development, more than 46,000 Ukrainians have received compensation worth UAH 4.84 billion ($117 million).

In 2023-2024 the regional war administrations received over UAH 16 billion ($387.5 million) to rebuild the regions - this figure includes all regions except Lviv, Luhansk, Zaporizhzhia, Ivano-Frankivsk, and the temporarily occupied Crimea.

The World Bank estimates the reconstruction needs at €486 billion.

For 2025 the Verkhovna Rada (Parliament) has decided to allocate more UAH 2.2 billion (€53.3 million) to implement a pilot project to restore several cities in the frontline regions affected by the Russian armed aggression. The following locations will be the main reconstruction targets:

  • Borodyanka, Kyiv region - UAH 884.6 million ($21,5 million);
  • Posad-Pokrovske, Kherson region - UAH 819.3 million ($19,9 million);
  • Trostyanets, Sumy region - UAH 278.1 million ($6,7 million);
  • Yahidne, Chernihiv region - UAH 238.1 million ($5,8 million);
  • Tsirkuny, Kharkiv region - UAH 5.9 million ($143,000).

The funds will be used for the comprehensive reconstruction of communities destroyed during the hostilities, which will allow for the prompt return of residents and stimulate the development of the local economy.

The process of rebuilding

The Ministry of Health of Ukraine reported that over more than two and a half years of full-scale war in Ukraine, 901 Ukrainian medical facilities have been fully and partially restored, including 551 fully restored and 350 partially restored.

The example of the Zhytomyr region is illustrative, where almost UAH 272 million ($6.6 million) was spent from state and local budgets over two years to eliminate the consequences of armed aggression and restore the damages. In total, almost 3,200 objects (66% of all damaged ones) were restored with these funds, money from citizens, territorial communities and charitable organizations.

Another example is the Chernihiv region; over the two years of war, 13,789 facilities have been damaged and destroyed. A total of UAH 1.03 billion ($25 million) is allocated from the state budget (including, but not limited to, the restoration of destroyed infrastructure and facilities) to implement projects in the region. In 2022, after the Russians fled, 93 damaged facilities were restored. As of February 1, 2024, the region restored 1471 facilities of utility companies, including 1055 electricity supply facilities, 318 gas supply facilities, and 98 heat supply facilities.

Today, both local companies and foreign contractors are involved in the process of restoring destroyed and damaged infrastructure in Ukraine. Although this process will be a long one, it has already begun.




Latest news


New leases

  • Cordon Electronics, a specialist in electronics and advanced technologies, has renewed its lease agreement at MLP Pruszków II, in the immediate vicinity of Warsaw. The company will continue to occupy a total of 7,770 sqm of modern space, a footprint that includes 458 sqm dedicated to office operations.
  • mBank, the digital banking company in Poland, has decided to relocate its largest corporate branch in Lower Silesia to the Infinity office building in Wrocław. The company will occupy nearly 1,300 sqm on the fourth floor of the building. The tenant will move into the development owned by Avestus Real Estate and Alchemy Properties in January 2027.
  • GSP Global Solutions Provider has further expanded its cooperation with CTP by leasing an additional nearly 7,000 sqm in CTPark Budapest Vecsés on a long-term basis.

New appointments

  • Krzysztof Wróblewski (MRICS) has been named Head of Portfolio Management CEE at Peakside Capital Advisors, responsible for overseeing investments and managing the real estate portfolio. He succeeds Christopher Smith in this role.
  • Garbe Industrial is reorganising its senior leadership team. CEO Christopher Garbe will now focus on strategic orientation and international activities. Jan Philipp Daun assumes leadership of the Development division alongside his existing Investment and Joint Venture responsibilities. Andrea Agrusow expands her remit to include Portfolio Management while retaining control of Commercial and Real Estate Management. Additionally, Michael Marcinek and Maik Zeranski will now jointly head the restructured Development unit as Management Board Members, succeeding Adrian Zellner.
  • CPI Property Group is strengthening its leasing structure with the appointment of Agnieszka Baczyńska as Head of Leasing. In her new role, she will be responsible for shaping and executing the leasing strategy across the group’s office and retail portfolio in Poland. At the same time, Izabela Potrykus has been appointed Leasing Office Director. Baczyńska brings more than 20 years of experience in the commercial real estate market. Prior to joining CPI Property Group in 2022, she served as International Leasing Director at Neinver Polska.


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