Virtual Property Forum, Europe's first comprehensive online property conference was held last week. We summarised some key insights of the panel discussion about investment strategies for the post-lockdown world, moderated by Otis Spencer (P3).
The current coronavirus crisis is not a financial crisis, so as restrictions are lifted and markets are returning to normal, we can expect a quick rebound, stated Noah Steinberg (Wing). Investment transactions are moving forward, however, all the processes are slower. Although it is really early to see the long-term consequences just yet, by Q3 2020 we will see a healthy market again, he added.
Even though we can count on a strong rebound towards the end of the year, we will not be able to catch up with the investment volumes of last year. As travel bans and other restrictions are going into the summer season, processes, property inspections as well as markets will take longer to revive, argued Adam Irányi (Union Investment Real Estate).
The market has not stopped, only slowed down with many transactions closed in the first half of the year, argued Balázs Gál (Erste Group Bank). There have been credit approvals of roughly half a billion euros of new transaction in CEE. The region has passed the worst, however, most of the recovery will come early next year, he said.
According to the experiences of Victor Constantinescu (Kinstellar), only one transaction has been cancelled because of the coronavirus crisis, most transactions still continue to move forward. The main issue is that we are not able yet to assess the risks of the next couple of months and terms are still unclear. In terms of asset classes, most deals have been closed in logistics, while a lot of investors are looking at less mainstream asset classes such as residential.
Since the lockdowns have been easing up, local companies and teams can work hard to do the inspections, so transactions will be picking up. Virtual tours have been very helpful in the last months, however, as no one is buying a property without a personal visit, they cannot be seen as a full replacement, said Tina Paillet (RICS Europe).
Bryan Wilson (Wilsons) took a more pessimistic view. According to him, until next year we will not see the recovery, as everyone is waiting to see what will happen in the autumn and people are concerned that the virus might come back. While not many transactions are going on currently, there are quite a lot of leasing issues as well as property management work on the legal side, like counselling for landlords and rent discounts negotiations.
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