h1 2011 investment market russia eng

3
MarketView Russian Investment H1 2011 CB RICHARD ELLIS Hot Topics ©2011, CB Richard Ellis, Inc.  www.cbre.ru OVERVIEW Confidence demonstrably returned to the Russian real estate investment market in the second quarter of 2011, with international investors joining domestic ones in making acquisitions. The overall investment volume was robust, offering the potential for 2011 to match the record levels of investment seen in 2007 and 2008. DEALS The total volume of deals transacted in 1H 2011 was Euro1.77 billion, in 13 deals. The second quarter of 2011 saw the largest ever quarterly volume of deals in Russia: over Euro1.6 billion was transacted in 11 deals. Even during the high-growth years of 2005-2008, the largest amount in any one quarter (Q3 2008) was Euro1.3 billion (20 deals). The largest deal in H1 2011 was the purchase of the 334-room Ritz -Carlton Hotel in central Moscow for an estimated Euro424 million by Verny Capital of Kazakhstan from Capital Partners. The hotel sector has hitherto been a niche investment sector in Russia, due mainly to the lack of investment- grade supply. Other notable deals in H1 2011 included: a 47% stake of White Square business centre in CBD (110,750 sqm), purchased in Q2 by a consortium of VTB and TPG from Coalco. The sale price was not announced. The same consortium of VTB and TPG at the same time purchased approximately 50% of White Gardens business centre in CBD (95,000 sqm, still under construction, due for delivery at the end of 2012) from Coalco. Again, the sale price was not announced. Alfa Arbat business centre in CBD (47,200 sqm), bought by Promsvyaznedvizhimost from TNK-BP in Q2. Kaluzhsky shopping centre in south-west Moscow (57,000 sq m), bought by Binbank from Z-Build in Q2. Filion shopping centre in western Moscow (128,00 0 sq m), bought by Kompleksnie Investicii from Rubin Development in Q2. Gorbushkin Dvor shopping centre in western Moscow (60,000 sq m), bought by Kompleksnie Investicii from Rubin Development in Q2. FM Logistic Industrial Park in Khimki, to the north of Moscow (75,000 sq m), bought by Hines Global REIT (USA) from AIG Global Real Estate and others in Q2. Classic business centre in CBD (45,000 sqm), bought by Lenmar Capital (controlled by Otkritie) from Kopernik Group in Q1. Investment Volumes by quarter, 2005 - 2011    E   u   r   o  ,   m    l   n Q2 saw the largest ever quarterly investment volume in Russia Domestic investors continued to pre-dominate Yields for prime office objects compressed sharply to 9% as sentiment recovered Office and Retail remained the most attractive sub-sectors Purchase of Ritz-Carlton Hotel in central Moscow was the largest deal Moscow remained the destination for the large majority of investment 0 200 400 600 800 1000 1200 1400 1600 1800 Q1 Q2Q3Q4Q1Q2 Q3Q4Q1Q2Q3Q4 Q1 Q2 Q3 Q4Q1Q2Q3Q4Q1 Q2Q3Q4Q1Q2 2005 2006 2007 2008 2009 2010 2011

Upload: smotco-smotcov

Post on 07-Apr-2018

229 views

Category:

Documents


0 download

TRANSCRIPT

Page 1: H1 2011 Investment Market Russia Eng

8/4/2019 H1 2011 Investment Market Russia Eng

http://slidepdf.com/reader/full/h1-2011-investment-market-russia-eng 1/2

MarketView 

Russian InvestmentH1 2011

CB RICHARD ELLIS

Hot Topics

©2011, CB Richard Ellis, Inc.

 www.cbre.ru

OVERVIEW

Confidence demonstrably returned to the Russian real estate investment market in the second

quarter of 2011, with international investors joining domestic ones in making acquisitions. Theoverall investment volume was robust, offering the potential for 2011 to match the record levels of investment seen in 2007 and 2008.

DEALS

The total volume of deals transacted in 1H 2011 was Euro1.77 billion, in 13 deals. The secondquarter of 2011 saw the largest ever quarterly volume of deals in Russia: over Euro1.6 billion wastransacted in 11 deals. Even during the high-growth years of 2005-2008, the largest amount in any one quarter (Q3 2008) was Euro1.3 billion (20 deals).

The largest deal in H1 2011 was the purchase of the 334-room Ritz-Carlton Hotel in central Moscowfor an estimated Euro424 million by Verny Capital of Kazakhstan from Capital Partners. The hotelsector has hitherto been a niche investment sector in Russia, due mainly to the lack of investment-grade supply.

Other notable deals in H1 2011 included:

a 47% stake of White Square business centre in CBD (110,750 sqm), purchased in Q2 by aconsortium of VTB and TPG from Coalco. The sale price was not announced.

The same consortium of VTB and TPG at the same time purchased approximately 50% of White

Gardens business centre in CBD (95,000 sqm, still under construction, due for delivery at the endof 2012) from Coalco. Again, the sale price was not announced.

Alfa Arbat business centre in CBD (47,200 sqm), bought by Promsvyaznedvizhimost from TNK-BPin Q2.

Kaluzhsky shopping centre in south-west Moscow (57,000 sq m), bought by Binbank from Z-Buildin Q2.

Filion shopping centre in western Moscow (128,000 sq m), bought by Kompleksnie Investicii fromRubin Development in Q2.

Gorbushkin Dvor shopping centre in western Moscow (60,000 sq m), bought by KompleksnieInvesticii from Rubin Development in Q2.

FM Logistic Industrial Park in Khimki, to the north of Moscow (75,000 sq m), bought by HinesGlobal REIT (USA) from AIG Global Real Estate and others in Q2.

Classic business centre in CBD (45,000 sqm), bought by Lenmar Capital (controlled by Otkritie)from Kopernik Group in Q1.

Investment Volumes by quarter, 2005 - 2011

   E  u  r  o

 ,  m   l  n

• Q2 saw the largest everquarterly investmentvolume in Russia

• Domestic investorscontinued to pre-dominate

•Yields for prime officeobjects compressed sharply 

to 9% as sentimentrecovered

• Office and Retail remainedthe most attractivesub-sectors

•Purchase of Ritz-CarltonHotel in central Moscowwas the largest deal

•Moscow remained the

destination for the largemajority of investment

0

200

400

600

800

1000

1200

1400

1600

1800

Q1 Q2Q3Q4Q1Q2 Q3Q4Q1Q2Q3Q4 Q1 Q2 Q3 Q4Q1Q2Q3Q4Q1 Q2Q3Q4Q1Q2

2005 2006 2007 2008 2009 2010 2011

Page 2: H1 2011 Investment Market Russia Eng

8/4/2019 H1 2011 Investment Market Russia Eng

http://slidepdf.com/reader/full/h1-2011-investment-market-russia-eng 2/2

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2006 2007 2008 2009 2010 1H 2011

Mixed-use

Residential

Hotel

Industrial

Retail

Office

Euro, mln

©2011, CB Richard Ellis, Inc.

Source: CB Richard Ellis

 Annual investment volumes

Prime yields (%)

Source: CB Richard Ellis

 M ar k  et   V i   e w

R  u s  s i   an

I  n v e s t  m ent  

H1 2  0 1 1 

There were just two deals outside Moscow: Aeroplaze businesscentre in St. Petersburg (33,000 sq m), bought by a St.Petersburg real estate agency PAN for Euro35 million; andSanMart shopping centre in Kaluga (47,000 sq m), bought by Torgovy Kvartal from London and Regional Properties.

  As in recent years, domestic investors led: just two dealsinvolved foreign investors, accounting for 27% of the total.These came from the USA and Kazakhstan.

SECTOR 

The office sector remained the most popular segment forinvestment in 1H, accounting for 42% by volume in six deals.Retail was the next most popular, accounting for 31% in fivedeals.

 YIELDS

 While there are still relatively few deals on the market, investordemand has nevertheless clearly strengthened, and thus wehave applied a substantial compression in the estimated primeyield level in Q2. We believe that by the end of Q2, a fully-letprime office object in Moscow sold at open tender could haveachieved a net yield of 9%, with 10.5% for shopping centresand 11.5% for industrial objects. The lack of investment-gradesupply remains, and will remain, a key factor in this - especially in the office segment: due to the financial crisis, newdevelopments were frozen or abandoned, with the result that

delivery levels are currently very low, and not set to recover until2013-2014. This is compounded by Moscow’s city governmentsuspending new construction permits while it reviews its city development plan. Consequently there is strong competitionamong investors for the few high-quality buildings, driving upvaluations.

OUTLOOK 

It is highly possible that the full-year total will exceed thevolumes seen in the 2006-2008 growth years. However, weforecast that this will not be by a large margin, as there are twokey impediments to investor action: internally there is still noclarity over the 2012 Russian presidential election, though thisshould be resolved by the end of the year; and externally the

global economic situation remains uncertain, with the threat of a “double dip” recession in the US and Europe now greater inmany investors’ perceptions. This acts as a deterrent toinvestment in markets viewed as risky. Domestic investors,therefore, will continue to drive Russia’s real estate investmentmarket in the short term.

Source: CB Richard Ellis

Source: CB Richard Ellis

0%

0%

0%

0%

0%

0%

0%

0%

0%

0%

0%

2006 2007 2008 2009 2010 1H 2011

Foreign Domestic

Source: CB Richard Ellis

Foreign/Local investors, 2006 – 1H2011

Czech Hungary Poland Russia

0

1 000

2 000

3 000

4 000

5 000

6 000

2005 2006 2007 2008 2009 2010 1H 2011

Eomln

-

500

1 000

1 500

2 000

2 500

3 000

3 500

2003 2004 2005 2006 2007 2008 2009 2010 1H 2011

 E u r o , m l n

0

5

10

15

20

25

   Q

   1   2   0   0   5

   Q

   2   2   0   0   5

   Q

   3   2   0   0   5

   Q

   4   2   0   0   5

   Q

   1   2   0   0   6

   Q

   2   2   0   0   6

   Q

   3   2   0   0   6

   Q

   4   2   0   0   6

   Q

   1   2   0   0   7

   Q

   2   2   0   0   7

   Q

   3   2   0   0   7

   Q

   4   2   0   0   7

   Q

   1   2   0   0   8

   Q

   2   2   0   0   8

   Q

   3   2   0   0   8

   Q

   4   2   0   0   8

   Q

   1   2   0   0   9

   Q

   2   2   0   0   9

   Q

   3   2   0   0   9

   Q

   4   2   0   0   9

   Q

   1   2   0   1   0

   Q

   2   2   0   1   0

   Q

   3   2   0   1   0

   Q

   4   2   0   1   0

   Q

   1   2   0   1   1

   Q

   2   2   0   1   1

Industrial

Retail

Office

Investment volumes across CEE

Investment by sector , 2006 – 1H2011

   %

Disclaimer 2011 CB Richard Ellis

Information herein has been obtained from sources believed to be reliable. While we do notdoubt its accuracy, we have not verified it and make no guarantee, warranty or representationabout it. It is your responsibility to independently confirm its accuracy and completeness. Any projections, opinions, assumptions or estimates used are for example only and do not representthe current or future performance of the market. This information is designed exclusively for useby CB Richard Ellis clients, and cannot be reproduced without prior written permission of CBRichard Ellis.© Copyright 2011 CB Richard Ellis

CB Richard Ellis is the market leading commercial real estate adviser worldwide - an adviserstrategically dedicated to providing cross-border advice to corporates and investment clientsimmediately and at the highest level. We have 400 offices in 58 countries across the globe, andemploy 30,000 people worldwide. Our network of local expertise, combined with ourinternational perspective, ensures that we are able to offer a consistently high standard of service across the world. For full list of CB Richard Ellis offices and details of services, visitwww.cbre.com