€2.88bn were invested in commercial real estate in Poland in H12022, 44% more than in the previous year – as CBRE’s report shows. The largest transaction involved the sale of the Warsaw Hub to Google for almost €586mn. It is the largest single building purchase transaction in Poland’s history. Europe-wide, €152bn were invested in H1 2022, which is up 10% from the previous year. This exceeded the previous record in 2018 when investments amounted to €151bn.
– The investment volume we witnessed in Poland during H1 2022 is the second largest volume on our market ever. Only in 2018 better results were recorded. This shows that we have navigated the pandemic quite well as is reflected in the strong opening in Q1. In addition to this, in spite of the war in Ukraine and its implications for financial markets and the general economic situation, we have also witnessed major transactions in Q2. Activity in the office real estate sector increased by 59% in H1 2022.In the retail sector, owing to the two portfolio transactions in Q1 2022, the growth was as high as 173%. Activity in the industrial & logistics sector dropped slightly, by 19%, which – however – results from the high baseline level of the previous year. Warehouse investments then amounted to as much as €869 mln which was the greatest amount of all sectors – says Przemysław Felicki, Head of Investment Properties at CBRE in Poland.
In Europe, Ireland, Belgium, and Poland stand out with significant growths
According to CBRE’s latest report, investment in European commercial real estate reached €152bn in H1 2022. The investment volume was up 10% compared to H1 2021 and exceeded the record of €151bn in 2018. The record first half was driven by a very strong Q1, where total investment volumes reached €84bn. This was the second strongest Q1 behind the record-breaking Q1 of 2020. Q2 volumes declined slightly, by 11%, to €68bn, as increased borrowing costs and economic uncertainty slowed investment activity. Real estate pricing has also been impacted by high inflation across the globe and central banks rate increases.
In terms of investment in Europe, Ireland (+47%) and Belgium (+134%) stood out. Investment volume in Ireland was driven by the Hibernia REIT portfolio consisting of office, residential, and warehousing properties. Italy (+53%), the Netherlands (+37%), Spain (+44%), and France (+24%) also posted higher volumes. In Poland, the growth in H1 2022 amounted to 44%. Overall, €2.88bn were invested in commercial real estate located in Poland.
Offices on the rise, retail showing signs of recovery
Return of employees to offices caused an investment growth in this sector in H1 2022 by 19%. Recovery can also be seen in retail – owing to a large transaction in Spain, European transaction volume in this sector grew by as much as 54%.
The office and the commercial real estate sectors stand out in Poland as well. In the former, the H1 2022 growth was as high as 59% year on year. Owing to the two portfolio transactions in Q1 2022, the commercial sector grew by as much as 173%. 19% decrease were recorded in the warehouse sector which results from the high baseline level of the previous year.
– In spite of higher financing costs, the investors still have appetite for commercial real estate, especially intended as a partial hedge against inflation risks. This affects yield rates and the market is currently trying to find a new balance. In the next few months, we expect to close several major transactions and start new processes which will emphasise Poland’s stable position and prove the market’s liquidity – Przemysław Felicki, Head of Investment Properties at CBRE in Poland, sums up.