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Experts explain changes in demand for renting and purchasing commercial real estate – Rossiyskaya Gazeta

Date: July 14, 2024 Time: 13:24:49

In general, in all segments of the commercial real estate sector there is now an increase in both the rental and purchase of premises, says Stanislav Bibik, partner of the NF group. However, the specific situation depends on the location and type of property. “In large cities and business centers, the demand for rental of office spaces remains high, while there is a trend towards the purchase of such spaces as real estate. The purchase of office buildings is observed among large investors, such as funds and institutional investors, “Investors are being cautious and carefully evaluating the profitability potential and stability of tenants.

The industrial and warehouse real estate segment, for its part, shows significant activity in terms of purchases, which is due to the growth of online commerce and the need for logistics centers and warehouses. Investors see this segment as a reliable investment with stable income prospects, notes Stanislav Bibik.

The rapid influx of capital into the Russian market has ensured increased demand for all segments of the real estate sector, notes Ekaterina Nogai, head of the research and analysis department at IBC Real Estate. Historically, rentals have dominated almost all areas, but in recent years the trend has changed, she said. Rental remains the main strategy within retail: high-quality commercial properties in Russia are sold only for rent, in street trade there is a demand from retail investors for a ready-made rental business, but due to the formation of a new product, today there is an important flow of interest towards other segments.

Thus, in the hotel market in recent years, the aparthotel format has begun to develop more and more actively, and investors with checks worth 10 million rubles have the opportunity to buy a room for rent. The format of purchasing rooms at low prices at the beginning of sales and their subsequent resale is practically not present in the segment. The main concern of the private investor is the generation of rental income.

In the warehouse segment, according to Ekaterina Nogai, there is a specific situation: retail investors practically do not have access to the product, since the minimum receipt for the purchase of light industrial products is more than 70 million rubles, however, End users of large format stores are increasingly forced to choose to buy an object instead of renting it.

The rapid growth of rates in the segment and the shortage of space that has persisted in the market since 2019 have led to the acquisition of a facility becoming a defensive strategy for warehouse users. Thus, in a record year in terms of demand, 2023, when 3.5 million m2 were sold on the capital region market. m, 22% of them were BTS sales and purchase transactions (construction for a specific client). Since the beginning of 2024, the volume of such transactions has already reached 350 thousand square meters. mo 19% of the demand.

In the offices there is a real boom in sales, says Ekaterina Nogai. Since 2019, a unique product has appeared on the market: high-quality buildings for sale from well-known developers, which has ensured a significant influx of investors in this segment. Since 2021 there has been a boom in demand and an annual increase in investment volumes. Buyers include end users expanding their businesses against the backdrop of rapid economic recovery and investors planning further resale or leasing of office blocks. At the end of 2023, the volume of purchase and sale transactions amounted to 446 thousand m2. mo 22% of the total amount of purchased and rented space in Moscow. More than 60% of the total volume of sales transactions corresponded to transactions in business centers under construction: 282 thousand m2. meter.

In 2024, the trend continues. According to preliminary results for the first half of 2024, about 140 thousand square meters were sold in the Moscow office market. m, of which 80 thousand m2. mo 57% – sales in facilities under construction.

In the street trade segment (commercial premises on the ground floors of buildings), according to Avito Real Estate, rental demand fell by 4% during the year, but this drop is less than the decrease in demand for the purchase of this type of properties. (-6% annually) .

The rental supply of these premises has not changed throughout the year, as calculated by Avito Real Estate, while the supply in the area where they were sold increased by 1%. The largest increase in rental supply among cities with a population of more than one million inhabitants is observed in Krasnodar (+24%), Perm (+13%) and Ufa (+12%). The most notable drop in supply occurred in Moscow (10%) and Volgograd (9%). Rental demand increased the most in Krasnodar (by 11%) and Yekaterinburg (10%), the most notable drop was again in Volgograd (by 25%), as well as in Chelyabinsk (14%) and Samara (11%). ).

The demand for rental of this type of property is more active than for purchase, because now renting is easier due to the high rates of mortgages and loans, says the associate professor of the Basic Department of Financial Control, Analysis and Audit of the University Economic of Russia. GV Plekhanov, Dmitri Osyanin. Buying requires a large financial investment, but renting allows you to spread the costs over several months or even years. The situation in the real estate market can be unstable, forcing companies to give up purchasing real estate and opt for renting to avoid risks, the expert added. At the same time, sustainable economic development and rising living standards of the population contribute to an increase in the number of potential tenants, which, in turn, supports demand.

Small businesses cannot take out expensive loans to buy premises, causing demand to flow into the rental segment. “The planning horizon of companies, given the general volatility of almost all markets, is reduced to between 1 and 2 years. Many factors can force a company to reduce or refocus its business by investing in commercial real estate. Especially if it is not an office, but a production or warehouse space, they carry greater risks,” explained Kirill Kulakov, president of the SRO “Regional Association of Appraisers”. Considering the cost of real estate, only a few can afford to take a loan at 20-22% per annum for their purchase, he added.

* This website provides news content gathered from various internet sources. It is crucial to understand that we are not responsible for the accuracy, completeness, or reliability of the information presented Read More

Hansen Taylor
Hansen Taylor
Hansen Taylor is a full-time editor for ePrimefeed covering sports and movie news.

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