Six prominent experts gave a 360-degree overview of the regional real estate market in the post-COVID-19 world at the online edition of Hungary’s Property Investment Forum 2020. We summarised the highlights of the discussion, moderated by Tuza Rita, Head of Capital Markets Hungary at JLL.

Immofinanz recorded an increase in rental income and in the results of asset management and property sales during the first three quarters of 2020 despite the COVID-19 crisis. FFO 1 (before tax) was only slightly lower than the previous year at €89.2 million. After an adjustment for the straight-lining of a bond coupon payment in Q1 2020 over 12 months, FFO 1 improved by 10.1% to €92.4 million. The capital measures carried out in Q3 2020 strengthened the equity ratio and reduced the net LTV to 38.4%. The strong cash position of €601.9 million at the end of September was increased to approximately €1.2 billion by the benchmark bond issued in October and an undrawn credit line.

Shopping centre owner NEPI Rockcastle achieved a collection rate of 97% of reported revenues for the first half of 2020 and 90% for the nine-month period ended 30 September 2020. The total value of COVID-19 related rent reliefs and discounts granted by NEPI Rockcastle up to 30 September amounts to €55.6 million. The company published a business update for Q3 2020.

This year is likely to be the best for the Polish warehouse and industrial market, predicts Savills, with leasing activity already setting an all-time high in Q1-Q3 2020. Occupier take-up predominantly came from food retailers operating without any disruption despite restrictions imposed on other retail sectors and from e-commerce, including logistics operators serving e-retailers.

GTC’s profit before tax and fair value adjustments increased to €21 million in Q3 2020 from €15 million in Q3 2019. For the January-September period, 2020’s results were slightly weaker at €52 million compared to the previous year’s €53 million.

The scale and number of transactions in storage real estate in Central and Eastern Europe makes it one of the fastest-growing markets on the old continent. Investors generally are following the growing demand for warehouse space resulting, among other things, from the growing role of e-commerce. At the same time, the strategic location on many north-south and east-west international routes makes the CEE region of Europe a highly desirable destination for warehouse locations. It is one reason why this sector is the only real estate segment currently experiencing year-on-year growth.

The third quarter in Poland’s industrial sector saw a fairly positive sentiment among tenants and developers. At the end of September, the country was the second most active market in Europe in terms of net demand and the amount of space delivered. Warehouse investments in Poland were approximately €2.2 billion between January and November, setting an all-time annual record.JLL summarised the situation on the Polish industrial market at the end of Q3 2020.

According to Savills latest research, total property investment activity in Poland, the Czech Republic, Slovakia, Hungary and Romania for Q1-Q3 2020 was €7.6 billion, the third-highest volume on record, despite the global COVID-19 pandemic. Total investment volumes by year-end are forecast to surpass €10 billion, which would be in line with the five-year average.

While the first results show that the GDP grew by 5.2% q-o-q in Q3 in the Czech Republic, the second wave of COVID-19 has forced the government to re-impose strict containment measures to curb the spread of the virus. Retail sales grew during the summer as they reached pre-pandemic levels. However, consumer confidence fell for a second consecutive month in September, while a worsening labour market outlook and a resurgence of new infections will mean households keep more precautionary savings as well as denting income. On the other hand, industrial production resumed growth in September and is likely to underpin economic growth as it is less exposed to the pandemic. Cushman & Wakefield summarised the situation in each market segment.

According to a report published by Cresa Poland, the vacancy rate on Poznań’s office market stood at 13.3% at the end of Q3 2020, down by 1.2 pp on the second quarter. It is the only office market in Poland to have recorded a quarterly fall in vacancies.