- CREN - Croatian Real Estate Newsletter

Transcription

- CREN -
Croatian
Real Estate
Newsletter
Volume 25, April 2008
CREN PATRONS
TABLE OF CONTENTS
1. INTERVIEW Charlotte Ruhe, EBRD Croatia, Head of office…………………………………...2
2. INTERVIEW Denis Čupić, REDSERVE d.o.o., CEO…………………………………………..5
3. THE FOURTH ANNUAL INTERNATIONAL CONFERRENCE ON THE REAL ESTATE
MARKET IN CROATIA May 05 & 06, 2008, Zagreb………………………………….….. 14
4. INTERNATIONAL CONFERENCE ON THE REAL ESTATE DEVELOPMENT IN
ALBANIA May 13 & 14, 2008.Tirana.............................................................................15
5. INVITATION FOR APPLICATION Tenant koordinator, Trigranit d.o.o.. ............................ 16
6. STATISTICS...................................................................................................................17
6.1. Average Asking Prices of Real Estate Offered for Sale – April 2008 .........................17
6.2 Statistical Reports of the Central Bureau of Statistics from the Area of Civil
Engineering………………………………………………………………………………….17
6.2.1 Construction work indices, February 2008………………………………………..17
6.2.2 Construction work indices, January 2008………………………………………....18
6.2.3 Building permits issued, February 2008…………………………………………...18
ADVERTISMENT Investment Conference on investing possibilities in Međimurje County……….... 19
7. PRESSCLIPING… .........................................................................................................19
8. PAST EVENTS… ...........................................................................................................21
9. DO NOT MISS OUT…....................................................................................................22
TOPICS OF THIS ISSUE:
Charlotte Ruhe
EBRD Croatia, Head of office
EBRD INVESTMENTS IN CROATIA
Denis Čupić
REDSERVE d.o.o., CEO
THE ROLE OF DEVELOPERS ON THE REAL ESTATE
MARKET
1. INTERVIEW
Charlotte Ruhe
EBRD Croatia, Head of office
EBRD INVESTMENTS IN CROATIA
In what sectors do you see Croatia
having the most problems and
challenges while preparing for entering
the European Union?
My outlook as the Director for Croatia for
EBRD is focused on the business climate.
From that perspective, Croatia’s biggest
challenges for entering the European
Union relate to competition policy and to
reform of the judiciary. The shipyards in
particular will have to demonstrate
that they can be viable and efficient with
significantly reduced financial support from
the State. Although not always an easy
process, this is a necessary part of
transition. As Croatia strives to attract
more foreign investments, it will be
essential to carry out judicial reform
to assure potential investors that Croatia is
governed by rule of law and efforts are
made to root out corruption.
Where do you see Croatia making the
most efforts?
Substantial efforts are in process in a
number of sectors, with good progress to
date, for example, in adopting the acquis
for the banking sector.
How much has EBRD invested into
Croatia since now and in how many
projects? What are
the
future
limitations?
EBRD has invested EUR 1.8 billion in 83
projects in Croatia since we began
operations in 1994. There are no limits on
future investment. Our business depends
on demand from the clients, their
investment needs and the general
situation in the market.
What sectors are you focusing on?
The Bank has always focused on private
sector, however, we also finance essential
infrastructure. We have a Strategy for
2007 – 2010. The focus agreed with the
Government and our Board is on (1)
providing debt and equity to local
companies to support their growth and
regional expansion, (2) preparing and
financing environmental infrastructure for
cities and counties, (3) providing finance
through intermediaries for small business,
(4)
supporting
privatization
and
restructuring of heavy industry and of the
tourism sector.
To what extent is EBRD involved in the
Property Sector and what are the
average transactions worth? Can you
specify any Property transaction?
The Bank has become quite active in the
Property Sector in the past two years,
having committed equity investments
totaling EUR 75 million in separate
investments in Adriatic Luxury Hotels
(Goran Strok) and Jadranka Hotels on
Losinj.
The Bank has relocated a
Principal Banker from the Property and
Tourism Team to our office in Zagreb to
cover the region. This has facilitated a
growing pipeline of potential investments
in Croatia and neighboring countries.
What are the most usual constraints
that developers are facing in the CEE
markets?
With the booming of the real estate sector
across most CEE countries in recent
years, resulting from a favourable
CREN - Croatian Real Estate Newsletter / April 2008
2 / 24
combination of good macroeconomic
prospects, rising demand for quality real
estate space in the region and easy
access to financing, a rising number of
actors has been entering the real estate
development sector. The key constraints
for developers in the CEE markets can be
looked at on 3 levels. First is access to
land, the prices of which have
dramatically increased in the last years.
Increased competition, together with a
strong real estate outlook have increased
the bargaining power of owners of land
and thus made it more difficult for
developers to acquire land at competitive
prices. Second is availability and pricing
of construction companies. As a result of
similar factors, availability of construction
companies, with both strong expertise and
resources has been increasingly difficult,
resulting often in delays in the start of new
projects and increased construction prices
(25% increase in construction costs in
some markets over the last 18 months).
Third, which is surely the most
problematic these days, is access to debt
financing.
Recent
years
were
characterized by easy access to debt
financing at relatively cheap margins and
flexible
covenants
and
condition
precedents. The situation is now
changing, in line with what is currently
happening in the Western markets,
through a progressive re-pricing of debt
instruments. Banks will become more
cautious and selective on granting debt
financing. More than ever, track record
and expertise will be a key factor of
differentiation between developers in the
near future.
economies, and in most cases, presented
greater risks.
The current crisis in
financial
markets
in
developed
economies, particularly the US and UK,
demonstrate that these economies also
can carry high levels of risk.
Are you going to be involved in the
privatization of Croatian hotel industry,
since tourism is the key trigger of
Croatia?
We have been involved from the
beginning and offered help to the
Government
through
the
Croatian
Privatization Fund on many occasions.
Recently, the Bank has proposed to the
Government to assist with privatization of
the remaining assets in hotel industry,
generally on a case by case basis, with
financing specific to the requirements of
individual projects. We hope they will
respond to our offer.
Where do you see Croatia in
comparison with other countries that
are on the same path as Croatia
(Slovenia, Bulgaria, Latvia…)?
The Croatian economy is very advanced
compared to neighboring countries. The
level of wages is one of the highest in
entire CEE region (including 12 new EU
member states) as is domestic debt to
GDP. On the other hand, other countries
such as the Baltic States, Hungary and
Slovakia, have few companies remaining
in
state
ownership
and
have
demonstrated much greater openness to
private financing of investments in
infrastructure.
What are the main criteria for financing
in emerging markets?
Criteria for financing in emerging markets
are no different than criteria for financing
in any market.
Historically, emerging
markets
offered
greater
growth
opportunities than more developed
What is your opinion on low realization
of green and brownfield investments in
Croatia over the past years?
The low level of investment may be partly
attributed to difficulties for potential
3 / 24
investors to acquire and develop property.
It can be extremely difficult to gain clear
property rights for a large plot of land. The
process of getting location and building
permits is time consuming and nontransparent, leading many investors
(particularly in property sector) to take
their money to markets that are more
transparent and less bureaucratic.
Do
you
cooperate
with
other
international
financial
institutions
present
in
Croatia
(European
Investment Bank, World Bank, MMF...)
and are you cooperating on some
projects?
The EBRD has co-financed many
infrastructure
investments,
including
Zagreb-Rijeka
Motorway,
Croatian
Motorways, and CroControl (air traffic
control) together with the European
Investment Bank. We are a co-lender
with the World Bank to the Port of Ploce.
We are a co-investor with the International
Finance Corporation in Adriatic Luxury
Hotels. The Bank always welcomes the
opportunity to work together with partners,
whether international or domestic. In this
regard, I would note that we also
cofinance projects with local banks
including Zagrebacka Banka, Privredna
Banka Zagreb and Raiffeisen Bank.
4 / 24
2. INTERVIEW
Denis Čupić
CEO
REDSERVE d.o.o.
THE ROLE OF DEVELOPERS ON THE REAL ESTATE
MARKET
Could
you
briefly
present
yourselves and the company you
work for?
I have been active on the real estate
market since 2000. From the beginning
of the business operations and
development of my companies, I have
been oriented towards the provision of
services for the final investor. Not
through classic forms of mediation on
the real estate market, but through
providing a comprehensive service to
renowned commercial chains, who
have been active during the expansion
in Croatia. This service was primarily
based on the fact that we represented
clients who were searching for a
location.
Besides
searching
for
locations, we performed assessments
of the locations, and we were involved
in the project through the process of
obtaining building permits and the very
beginning of construction work.
Through my activity on the real estate
market, I established contacts with the
Redserve company, in relation to the
project, on which I currently work, and I
accepted the offer by Redserve to take
up the management of that company.
In the course of my further growth
within the Redserve, it is my goal to
attract my previous clients to this
company. We have decided to provide
a broad range of high quality services.
Throughout my business life, I have
been oriented towards international
markets, so that even the activities I
performed before becoming active on
the Croatian real estate market were
actually related to foreign companies.
A part of the work I did was to organise
marketing and expansion for Amcro –
Unocal, and the sponsorship of Niko
Pulić, and to develop the company
Unocal, which today is part of Chevron,
on the Croatian and Eastern-European
market. During this cooperation, and
while assisting the then CEO of Amcro
- Unocal, Mr. Mark Cooper, who had
previously managed a developer
company in the United States for many
years, I understood very early on what
it means to be a developer, and what
kind of services a developer provides
for his investor, and what services he
provides to the market. From the
beginning of my activity on the real
estate market, I have striven to raise
this service to a higher level, higher
than the level of services accessible on
this market at that time.
Redserve d.o.o. is part of the
international holding company, ATP
Architects and Engineers. One of the
important
characteristics
of
the
individual companies within this
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holding is their international character
and their orientation towards the user.
Redserve is a result of one of its
development states, as a company that
follows the investor throughout the
whole investment process, and makes
it possible to have a good quality
dialogue between the investor and the
architect, between the investor and the
contractors, between the investor and
the institutions, where it is necessary to
cooperate and to coordinate everything
until the “turnkey” stage of the project.
Redserve is primarily a serviceoriented company. We provide our
services on a free market. We do have
the support of some of our key account
clients, but we are always reaching out
to new clients, and new investments,
which forces us to constantly improve
our services. We grow and perfect
ourselves through each new project.
Redserve, which has its headquarters
in Vienna, also has offices in Zagreb
and Hamburg, Redserve Croatia,
Redserve Austria and Redserve
Germany. The youngest company
within the Redserve group is Redserve
Germany, which came into being in
cooperation with the Wegner Group,
which enriched us with a wide
spectrum of investments and knowhow, as Mr. Betsmann, who is the
CEO of Redserve Germany, has a rich
experience in developing a number of
projects in Germany.
Jochen Seibert, the CEO of Red Serve
Austria, has been working in the real
estate field from the beginning of his
professional life, from Erste Bank,
Austrian Railways, and later in
Redserve. Ms. Christina Kassl Hamža,
who is the authorized representative of
Redserve Austria, also has experience
with a broad range of projects, which
she worked on before joining
Redserve, and myself, of whom I least
like to speak: I have gained quite a
broad experience through my work so
far on the Croatian real estate market.
What is the greatest challenge you
face in everyday life?
We are always trying to dance a kind
of “ballet”, and to coordinate our
business obligations with our private
lives. The challenge lies in the fact that
I truly love this work, and it gives me
pleasure to see how a project grows,
and to see it finished – at the “turnkey”
stage. On the other hand, it is a
pleasure to see the investor satisfied,
once the project is complete, in a way
that satisfies him.
The largest project, in which
Redserve was involved as a
developer in Croatia is Shopping
City Zagreb. Can you describe to us
at what stage this project is now?
Shopping City Zagreb is a project,
which along with being the largest
greenfield investment in Croatia, has a
specific purpose, because it is oriented
towards retail, logistics and a business
park. It is a project, the volume of
which surpasses everything developed
in Croatia so far. There has not been
any investment of this scope before,
and naturally this poses constant
challenges for its development. It will
be developed on a surface larger than
1,000,000 m². It is a great challenge
and a great satisfaction to be able to
develop such a project. The project
itself is conceived as an agglomeration
of commercial allocations, linked with
logistics and a business-technology
park. The core of the whole project is
the West Gate Shopping Centre, which
will be the largest shopping oasis in
Croatia. It will be a centre, where you
won’t spend just an hour or two
shopping, but where you will be able to
spend much more time, to enjoy more
than just a shopping experience, and
6
where you’ll be able to make shopping
an event. Other projects within
Shopping City Zagreb, which is still
being
developed,
include
the
«Fachmarkt» centre, which is a “strip
mall” concept. In Croatia, this term
sounds awkward: a centre with
specialized stores. It is very hard for
people to grasp what this is all about. It
is a centre, which will host middle price
range stores as a supplement to the
high quality larger shopping centre.
Further projects being developed there
include a car park, as a first
agglomeration of car dealerships, and
companies related to the automotive
industry and mobility in Croatia. The
idea is to create an agglomeration with
about 10,000-15,000 square meters
gross surface area, on a plot of about
30,000
m².
Through
modern
architecture,
it
should
offer
individualized
premises
to
car
dealerships, car repair shops, a station
for technical examination of vehicles,
and stores with spare parts and
equipment. Along with the part
allocated to gastronomy, there will be
one part dedicated to the youngest.
We decided to introduce this part of the
project, because Croatia has been a
growing market for cars in the past
years. If you have been reading
newspapers over the past year, you
will have noticed that the car
dealerships
and
authorized
representatives of different car brands
predict an increase of sales for this
year, despite the financial crises that
have affected the whole world. A
further stage within Shopping City
Zagreb project will be a logistics
centre, and a business and technology
park in the northern part of the area,
and this will be the final stage of
development of Shopping City Zagreb.
This development of Shopping City
Zagreb will be a further incentive for
the development of the town of
Zaprešić, it will contribute to its
positioning in Croatia, and generate
new purchasing power and attract new
inhabitants to the town of Zaprešić. It
will also positively influence the whole
region around Zagreb. The one thing
that the Shopping City Zagreb has as a
great advantage is excellent transport
connections, not only with Zagreb, but
with all other regional centres in the
Zagreb catchment area. A project,
which can be described as equivalent
to this is the Shopping City Süd near
Vienna. A similar project was
developed in the municipality adjacent
to Vienna, and this is now the
area with the highest level of
development within Austria.
The project is now in the construction
stage, the construction of the West
Gate Centre already started in 2007,
and the whole area is slowly being
prepared for construction. One of the
great challenges was to organise
construction works on such a large
surface area. Currently, we can say
that – judging by the dynamics we
have achieved – we are definitely
within deadlines, and the project is
progressing satisfactorily.
Can you present to us other
projects in Croatia, in which
Redserve is involved? Are these
just projects in the retail sector?
The projects we are currently
developing include shopping centres in
Varaždin and Karlovac. Investors in
Croatia are now largely focused on
what is called secondary, or “B” cities
in Croatia, since these cities practically
do not have good-quality commercial
centres, so we identified our interest in
participating in two such projects. The
projects we are currently negotiating
have a broader scope, they are not just
focused on retail. Redserve is a
company, which is not only oriented
towards retail projects, our focus is on
7
the development of projects in the
logistics sector, housing, tourism
projects, multifunctional projects and
office towers. So currently we have
projects we are negotiating, where it is
likely that we will conclude contracts in
the coming months.These projects
range
from
office
premises,
technological
centres
to
airport
projects. They also include projects in
the sector of the manufacturing
industry, related to industrial and
logistics facilities, and this kind of
projects is naturally very interesting to
us, because the current investments
are focused on retail, but we believe
that the orientation of investors will
slowly disperse towards other types of
projects as well. It will be necessary to
focus on investment cycles in the
provision of services, and organisation
of projects, and to complete them
successfully.
Could you present to us some
Redserve projects on the regional
scale.
present in Croatia, Austria and
Germany. In all these three locations,
where we are present, we cover
markets based in Austria, Croatia and
Germany, but which extend further – to
most Eastern European countries. In
particular, we were present with
projects in Slovakia. Currently, we are
contemplating projects in Serbia, and
expansion to the whole Balkans
region,
Slovenia
and
BosniaHerzegovina. We want to be active in
all parts of Eastern Europe. The
markets that are expected to become a
great development “hit” next include
Ukraine and Belarus. These are the
markets we are looking towards, and
where we intend to provide our
services. The projects that we are
either developing or which are already
completed resulted from Croatian
projects, Shopping City Zagreb and the
shopping centres in Varaždin and
Karlovac. The projects, for which we
won awards include projects in
Slovakia: CEPIT (Central European
Park for Innovative Technologies) and
MFZ Vajnorska Straße in Bratislava.
As I mentioned in my introduction,
Redserve is a company, which is
CEPIT – Central European Park for Innovative Technologies
8
CEPIT is the Central-European Park
for Innovative Technologies. As a
green-field investment, this is a park,
which includes modern industrial
facilities, along with schools and
housing facilities. The project of the
CEPIT technology park, as a new
urban centre and a model for the whole
region, is the first step in the
continuous development of Bratislava
as the “white city”, unburdened with
huge
technology
facilities.
This
technology park is conceived as an
area of work, used 24 hours a day,
because it is accompanied by housing
and shopping premises. It is the project
for which Redserve GmbH won the
Real Corp 2007 Award in the category
of Working Environments for the
Information and Knowledge Society. It
became the new urban centre, and it
provided an incentive for the
development of the whole surrounding
region.
The multifunctional MFZ Vajnorska
centre, which merges the residential
function,
hotel
accommodation,
recreational premises and offices, is
also one example of uniting housing,
hotel,
recreation
and
business
functions. This is also a project, which
we are very proud of, and we believe it
is moving in a good direction.
The multifunctional MFZ Vajnorska centre
Further projects that we would like to
present include projects that have
been developed by our German
company. The most important projects
of the German office of Redserve, with
its headquarters in Hamburg, include
the AOC Bürohaus business centre in
Frankfurt, and the Mönkhof Karree
Shopping Centre in Lübeck, for which
we developed the designs and
represented the investors throughout
the whole process of construction. The
AOC business centre was developed
on a surface of 26,000 square meters,
and it represents a merger of business
and commercial allocations, whereas
the Mönkhof Karree Shopping Centre,
with its 15,300 square meters, has a
diverse commercial offer.
9
Mönkhof Karree Shopping Centre in
Lübeck
Can you compare the Croatian real
estate market with the markets in
the region (Serbia, Monte Negro,
Bosnia-Herzegovina etc.)
The Croatian real estate market is a
market, which started to develop much
earlier than other markets in the
region. Croatia was the first country,
after Slovenia, to start the process of
EU rapprochement. For this reason,
the prices of real estate on the
Croatian market have always stood out
in comparison to the rest of the region,
but now – with current developments –
it is evident that the prices in Serbia,
for instance, and especially in
Belgrade, have started to exceed the
prices of real estate in Croatia. Both
international and local investors in
Serbia are focused on projects both in
Belgrade, and in smaller cities – Novi
Sad, Čačak, Niš. The real estate
market of Montenegro is a market,
which has become quite saturated,
because of the entry of investors from
the Russian market, who are largely
present in Montenegro and who have
more or less closed this market for
further investments. Bosnia and
Herzegovina (B&H) is still a market
that is slowly stagnating, except in two
major centres – Banja Luka and
Sarajevo. I believe that in the years to
come, B&H will develop as a real
estate market, in the segment of the
AOC Bürohaus Business Centre
manufacturing industry and logistics.
B&H has an interesting geo-strategic
position, and these are the kinds of
investments, which will be oriented
towards Bosnia-Herzegovina in the
years to come. We expect investment
in Kosovo as well. It will include
investment in industrial facilities and
revitalization of industrial facilities. With
gradual stabilization, Kosovo will
experience a boom, and an increasing
number of international companies
have already focused on industrial
facilities in Kosovo, which will make
Kosovo experience new development
and modernisation. An
obvious
example is a project contracted by
Konstruktor,
relating
to
the
construction of the highest business
tower in the Balkans, which will be
located in Kosovo.
Such market developments will
gradually result in the harmonisation of
market prices in this whole region.
In Croatia, the focus of investors is
moving from Zagreb to secondary “B”
cities, which are the cities with 50,000
to 80,000 inhabitants. Currently,
investors are very interested in
Slavonski
Brod,
Karlovac,
and
Varaždin. The coastal area has always
been attractive, and it will remain so.
The next step will include investments
in Zadar and Split. Rijeka has always
10
been the target of investors, but it has
also always posed problems because
of its topography. It is precisely Rijeka
that will be a good opportunity for good
quality developments, which will
consist in the revitalisation of the
former industrial facilities as new multifunctional premises.
It is evident that very large investments
in Croatia will involve the tourism
sector, and in the next five years also
the logistics sector. This is a sector, in
which there have been no major
projects in Croatia so far, and logistics
facilities are very much needed for
further industrial development and the
prosperity of certain regions.
What are your prognoses for retail
development in Zagreb, in the
regional centres of Croatia, and in
smaller Croatian towns?
Frequently, I hear the question why so
many shopping centres are being built
in Croatia. The reason is simple –
Croatia, as most other transitional
countries, does not have a classic
shopping street. We can all remember
the 1980’s, when it was normal for
people to go to Zagreb and shop in
small boutiques. These boutiques have
now disappeared. The market is now
open. In those years, retail was
oriented towards self production, a
closed system that did not allow much
import. Nowadays, when the market is
open, the small boutique shops are
slowly disappearing, and the centre of
the city is occupied with small-surface
shops of lesser known designer
brands,
but
the
internationally
renowned brands currently entering
the Croatian market are looking for
bigger, better quality premises to
locate their stores, and unfortunately, it
is difficult to find such premises in the
centre of the city. Most premises in the
centre of Zagreb range between 50
and 300 m², and they are difficult to
integrate
into
one
good-quality
shopping area. It is precisely for this
reason, that commercial brands are
focused on shopping centres, which
make it possible to have larger and
better quality shopping premises. This
kind of development is usual for almost
all transitional countries, and it is not
specific to Croatia.
On the other hand, developments in
the secondary cities will be similar, due
to these same reasons, but also due to
the fact that in many Croatian cities
with 50,000 to 80,000 inhabitants,
there is no classic city centre, because
these are cities, which have grown in
the past 20 years, and have thus
spread to the outskirts, so that the only
way to accommodate retail business is
in shopping centres.
Currently, investment problems are
frequently mentioned, but these are
not problems specific to Croatia, but
problems encountered in almost all
transitional countries. These problems
were not created or generated in the
past ten years, but they have been
inherited and have persisted through
generations. One large problem is the
lack of order, or the discrepancy
between the land registry data and the
real situation, plus the discrepancy
between the land registry data and the
cadastre. There is a simple reason for
this: most plots, on which projects are
built today used to be agricultural land
in the 1970’s. Under the Socialist
regime,
private
ownership
was
negated, and the emphasis was laid on
the right to use the land. People were
more focused on updating the data in
the cadastre than in the land registry,
and this is what generated the lack of
order we have today in the land
registry. The chain of owners of a
certain piece of property, which has
been regularly updated in the cadastre,
was not entered into the land registry.
One of the reasons for this was that
11
people were obliged to pay water utility
fees, based on the cadastre records.
Therefore, the new owners were keen
to change the records in the cadastre,
but not in the land registry. This is one
of the largest problems that the
investors in Croatia are faced with.
One of the other things, which makes
business operations more difficult, both
for foreign, but also for local investors,
is the slow pace of everything. The
slow pace of instruments, and the slow
pace of the administration in Croatia,
which is a very bureaucratic apparatus,
and you cannot obtain any answers
within reasonable deadlines. The
investors are too often compelled to
wait for months, and all this affects the
investments and indirectly it affects the
development of the whole Croatian
society. Another thing, which is typical
for all transitional countries, is the
beginning of raising awareness of the
importance of continuous development
of projects and societies.
How open are the investors to
Croatia? Is the trend of foreign
investments in Croatia decreasing
or increasing?
Ever since the creation of the Croatian
state, there has been interest shown
by foreign investors. So far, our focus
has
been
on
investors
from
neighbouring countries, so that in
quantitative
terms,
our
largest
investments came from Austrian
companies and Austrian investors.
There have also been many Slovenian
investors, but recently there are more
investments from other markets, that
had previously were not so focused on
Croatia, for instance from the AngloSaxon countries, and even the USA.
This primarily relates to funds, which
have slowly started opening towards
investment in Croatia. Most of these
funds are not inclined to invest in risky
markets. Croatia has become a market
with a reduced risk, as it is slowly
approaching the EU market, and this
will open it up for an increasing
number of investments. On the other
hand, speculative investors, who are
ready to accept higher risks, are slowly
going away and are focusing on other
countries in this region. These are
Serbia, Kosovo, Bosnia-Herzegovina.
The investors will only be distributed
differently, but their number will not
reduce. The new investors will focus
on a different type of facilities: projects
in the tourism sector or the logistics
sector. I believe there is currently no
room for fear that Croatia might lose its
attractiveness for investors.
What is your experience with
financial institutions in Croatia? Do
they support the large projects or is
it easier to establish cooperation
abroad?
Due to the fact, evident throughout the
whole global market, that the crisis and
recession in the whole banking system
is caused by the USA banking system,
and it was brought about by real estate
projects, it certainly decreased the
response by the banks. However, the
banks are still open for this type of
investment, and this can also be said
for Croatia, where there is still interest
in project development. Banks also are
contemplating the development of their
own projects, but the banks have
slowed down the investment cycle in
the past several months due to the
developments on the global market.
This is not specific to Croatia, but to
the whole of Europe, or even the
world.
What is your thinking about market
development tendencies?
As has been evident in Croatia in the
past months, there has been a slight
change in the pace of investments. An
12
increasing number of entities from the
commercial sector are deciding to
lease premises, rather than to invest in
their own facilities.
One of the reasons for this is certainly
the higher price of land, the long period
of waiting for permits, and thus also
paying the price of capital for this
period.
The Croatian market, but also
shopping habits, are still related to the
situation and the regime that prevailed
until the 1990’s. Croatian buyers are
educated buyers, who pay a lot of
attention to their experience of
shopping.
One of the reasons for this is the
circumstances that prevailed until the
1990’s, which made it impossible for
international retail companies and their
products to enter Croatia. On the other
hand,
we
can
all
remember
department stores, which are a kind of
predecessor of shopping malls. This
makes it evident that the development
of good quality shopping premises
satisfied such educated buyers.
An increasing number of projects still
need to be developed, and an
increasing number of investments will
start in the segment of modern
distribution and logistics. By raising the
awareness of competitiveness, both
domestic and foreign companies,
which have entered Croatia in the
production sector, will realize that it
takes a lot of strength and experience
to invest in modernisation, and for new
investments and further development
of production, logistics, warehouse and
distribution facilities. It is precisely the
higher
level
of
planning
and
development that will contribute to
higher efficiency and competitiveness.
13
14
15
5. INVITATION FOR APPLICATION..
INVITATION FOR APPLICATION
for the post of
Tenant Coordinator
TriGránit has emerged as one of the largest property developers in Central & Eastern
Europe. The company has so far completed projects with a total value of Euro 1.5
billion. TriGránit is currently working on some 30 developments across 11 countries
with a total planned investment of Euro 8 billion. After having successfully completed
projects in Hungary, Poland and Slovakia, the company has now widened its focus to
include Romania, Serbia, Croatia, Slovenia, Montenegro, Bulgaria, Russia and
Ukraine.
Due to this steady growth, we are looking for a Tenant Coordinator.
Job Description:
• Coordination of fit-out works for tenants
•
Ensure timely completion of fit-out works for Tenants
•
Reporting to Head Tenant Coordinator on all fit-out activities
•
Supervision of all activities with the tenant for procurement of all necessary permits
•
Coordination of project approval by the Lessee for fit-out works by the Tenants
Profile:
• Minimum of High School Diploma
•
Knowledge of Construction Regulations
•
Proficient in English Language (written / verbal)
•
Proficient in use of MS OFFICE
•
Excellent organization and communication skills
•
Ability to work within a team environment
•
Drivers License B Category
Ideal candidates should have a background in Architecture or Civil Engineering.
Please send your applications with a CV in English and your photo on e-mail: mail : [email protected]
or address: Trigranit
Tomašićeva 8
10 000 Zagreb
Croatia
16
6. STATISTICS
6.1.
Average Asking Prices of Real Estate Offered for Sale – April
2008
average price
EUR/m²
price range
EUR/m²
2.240
1.905
817 - 5.000
593 - 6.750
1.735
2.002
840 - 3.000
Office blocks
1.289
618 - 1.692
Housing
Apartments
Houses
Commercial space
Tourist facilities
2.062
1.867
1.614
2.811
503 - 4.745
263 - 11.600
555 - 4.605
750 - 9.537
ZAGREB
Housing
Apartments
Houses
Commercial space
Offices
Business premises
668 - 8.663
COAST
Average is calculated on the basis of the currently quoted prices on the Burza nekretnina d.o.o.
(Real Estate Stock Market ltd.), which is available online: www.burza-nekretnina.com.
6.2 Statistical Reports of the Central Bureau of Statistics
from the Area of Civil Engineering
6.2.1 Construction work indices, February 2008
In February 2008 construction works
increased by 15.0%, as compared to
February 2007.
Construction works in the period from
January to February 2008 increased
by 12.9% as compared to the period
from January to February 2007.
In February 2008 :
- by type of constructions, 49.6% out
of the total working hours were done
on buildings and 50.4% on civil
engineering works;
- by type of works, 62.5% out of the
total working hours were done on new
constructions
and
37.5%
on
reconstructions,
repairs
and
maintenance.
Notice: Construction work indices, February 2008, central Bureau of Statistics,
Zagreb, 2008.
17
6.2.2 Construction work indices, January 2008
In January 2008 construction works
increased by 10.5%, as compared to
January 2007.
In January 2008 :
- by type of constructions, 51.7% out
of the total working hours were done
on buildings and 48.3% on civil
engineering works;
- by type of works, 62.4% out of the
total working hours were done on new
constructions
and
37.6%
on
reconstructions,
repairs
and
maintenance
.
Notice: Construction work indices, February 2008, central Bureau of Statistics,
Zagreb, 2008.
6.2.3 Building permits issued, February 2008
In February 2008, there were 807
building permits issued, which was by
28.1% less than in February 2007.
The total number of building permits
issued in the period from January to
February 2008 was by 38.0% lower,
as compared to the same period of
2007.
In February 2008:
issued on buildings and 11.0% on civil
engineering works
by type of construction works,
79.2% of permits were issued on new
constructions
and
20.8%
on
reconstructions.
According to permits issued in
February 2008, it was expected for 1
491 dwellings with the average floor
area of 79.5 m2 to be built.
by type of constructions, 89.0% out
of the total number of permits were
Notice: Building permits issued, February 2008, central Bureau of Statistics, Zagreb,
2008.
18
ADVERTISMENT
Investment Conference on investing possibilities in Međimurje
County
7. PRESSCLIPING…
April 14, 2008, Poslovni dnevnik
28 percent decrease in permits, value of works 278 million
HRK lower
J. Tica: A slow-down in the construction business slows down the whole economy
and GDP growth; the state should have made the laws less strict
The trend of a drastic decrease in the
number of building permits issued
continued in February as well.
According to the most recent data by
the Central Bureau of Statistics, only
807 building permits were issued in
February, which is a 28.1 percent
decrease in comparison to the same
month last year. The value of works
according to permits issued decreased
by 278 million HRK, from 1.57 billion
last February to 1.292 billion HRK this
year. When we consider the data on
building permits issued for the first two
months of this year, there is a 38
percent decrease, which is interpreted
by analysts as an introduction to a
crisis in the construction business and
a slow-down of the whole sector. One
can expect consequences for the
overall economy and GDP growth,
19
because the construction business is
an anticipating factor for the overall
state of play in the economy.
The new Construction Act
There are several reasons for this
situation, and among the most
significant ones is the new Spatial
Planning and Construction Act, which
prescribes that building permits cannot
be issued, if the work on roads leading
to planned buildings has not yet
started. Other related factors include
interest rate growth on loans and a
decrease in the sale of apartments.
The only indicator, which is to some
extent positive, is the information that
February showed a smaller decrease
in the number of building permits
issued than in January, and the total
value of works in this two-month period
amounted to 3.78 billion HRK, or 900
million HRK more than in the first two
months of last year. To recapitulate, in
January this year, the number of
permits issued decreased by 50.5
percent in relation to January 2007, but
nevertheless the value of the planned
works was higher. Despite the smaller
number of permits, there was no
decrease in the value of works
recorded so far. “I wish I could say that
the decrease in the number of building
permits is a short-term indicator, but I
am afraid that we won’t be able to
avoid a slow-down of the overall
economy, as a reflection of these
indicators.
With
fewer
permits,
eventually the quantity of works will
decrease, there will be fewer orders of
construction material and equipment
for buildings, which will in turn affect
numerous suppliers. Less work and
fewer contracts will result in lower
salaries,
lower
consumption,
a
reduction in the number of jobs, which
in turn leads to a decrease in the GDP.
The construction industry alone
employs more than 100,000 persons,
and by June, many of them will be left
with nothing to do, once the works,
which have already started, are
finalized. The construction industry, as
the fastest growing industry, has been
affected by a series of aggravating
circumstances, including the Act, and
the Regulation on Licensing, and the
increase of interest rates. I believe that
the state should have taken this into
account, when it adopted the relevant
legislation,” says Josip Tica, assistant
professor at the Faculty of Economics
and Business, who specializes in
developments on the real estate
market. He also mentioned that
statistics show that the cause of a
decrease in the number of permits and
the value of works is not the fact that
the construction companies filed more
requests for building permits before the
new law came into force on 1st
October. “One month before VAT was
introduced, imports increased by 200
percent,
because
goods
were
purchased for the whole year.
However, no such growth was
recorded in the construction business,”
says Tica.
Government contracts
If we present the official statistical
records for February without the works
in the field of infrastructure, in which
the state was investor, and which
account for 11 percent of all permits,
then the decrease is even more
significant. The value of works on
buildings amounts to 998.3 million
HRK, which is 26.6 percent less than
last February, and the planned surface
to be constructed is as much as 31.5
percent less. In concrete numbers this
means 470 apartments less, and it
20
needs to be mentioned that the
average surface of apartments in
relation to last year is at least 7 square
meters smaller. “The main reason for
the decrease of the number of building
approvals are the local government
units, which were not prepared for their
new duty of issuing permits to build. In
principle, the law regulates this field
and introduces the positive practice
that one cannot build if roads and utility
infrastructure
are
not
provided.
However, we are in a transitional
period, which has slowed down the
whole construction industry,” says
Zdenko Karakaš, president of the
Employers’
Association
in
the
Construction Industry of Croatia, which
is active within the Croatian Employers’
Association.
The Croatian construction business in January and February
February
· number of permits
· value of works (in billion HRK)
· number of apartments
· surface of apartments
January and February
· number of permits
· value of works (in billion HRK)
· number of apartments
· surface of apartments
2006
2007
2008
1030
1122
807
2.64
1.57
1.29
1881
1927
1491
155658
166373
118509
2006
2007
2008
1991
2007
1245
4.57
2.8
3.78
3641
3361
2462
301072
290689
196340
8. PAST EVENTS…
Date
Name
Location
Web
www.easteurolink.co.uk
January 1, 2008
4th Annual Real
Estate
Conference for CEE
Prague, Czech Republic
February 1 - 2,
2008
„Zagreb
Development“
Conference
Zagreb, Croatia
www.grad.hr/zagreb
February 27, 2008
5 CEE Real Estate
Quality Awards
Warsaw, Poland
www.ceequa.com
March 11 - 14,
2008
MIPIM – Property
talks 2008
Cannes, France
www.mipim.com
th
21
SIMA 2008
Madrid, Spain
www.simaexpo.com
TIME TO INVEST
UKRAINE
Kiev, Ukraine
www.europaproperty.com
April 8 -12, 2008
April 16 - 17, 2008
April 16-18, 2008
ICSC European
Conference
Amsterdam RAI
Amsterdam, Netherlands
April 23 - 24, 2008
Investments.
Construction.
Development in Russian
and CIS
Moskva, Russia
www.rpi-inc.ru
April 23 - 25, 2008
Real Estate
Investment World
Russia 2008
London, England
April 26-27, 2008
4th croatian Realestate and associated
industry fair
Zagreb, Croatia
www.centarnekretnina.hr
9. DO NOT MISS OUT…
Date
Name
Location
Web
May 06 – 07,
2008.
Immobilienwirtschaft
2008.
Berlin, Germany
www.immobilien-forum.com
May 06 -07, 2008
GRI WORLD SUMMIT
2008
London, England
www.globalrealestate.org
May 08, 2008
The 3rd Annual SEE Real
Estate Awards Gala for
2007
Bucharest, Romania
May 09 -10, 2008
CEPIF
Warsaw, Poland
May 21 -22, 2008
Europaproperty CRE
Russian Investment
Conference II
Moscow, Russia
May 27 - 29, 2008
REAL VIENNA
Vienna, Austria
www.realvienna.at
22
May 29 -31, 2008
2008 FIABCI World
Congress
Amsterdam,
Netherlands
www.fiabciamsterdam2008.co
m
June 01 – 03,
2008
Retail City 2008 Bringing Together
Retailers & Malls In
Emerging Markets
Dubai, United Arab
Emirates
www.retailcity.ae
June 10 – 13,
2008.
The Italian Real Estate
Event
Milan, Italy
www.italiarealestate.it/eire/en
g
June 16-18, 2008
CIB W70 International
Conference in Facilities
Management
Edinburgh, Scotland
www.fmresearch.co.uk
November 06 -08,
2008
Expo Real 2008
November 13-17,
2008
The World Urban Forum
IV
Munich, Germany
Nanjing, China
www.exporeal.net
www.unhabitat.org
NOTE: In Volume 24 of CREN an accidental mistake has been made in the article
“The role of Architects in Real Estate development”. It is stated in the article that Mr.
Otto Barić, B.arch, is director of company ATP projektiranje d.o.o. This statement is
incorrect. Mr. Otto Barić, B.arch., is director of the company ARHITEKTURA
THOLOS PROJEKTIRANJE d.o.o. CREN editorial apologizes to Mr. Otto Barić and
to the readers for this accidental mistake.
23
PUBLISHER:
Filipović Business Advisory Ltd.
Trg bana Josipa Jelačića 3/V
10000 Zagreb – Croatia
Tel: +385 1 481 69 69
Fax:. +385 1 483 80 60
e-mail: [email protected]
It is our wish that the Croatian Real Estate Newsletter / CREN be a source of speedy
and quality information for all who are active in the real estate sector – developers,
planners, contractors, mediation agencies etc. Please send your comments,
proposals and opinions to [email protected] to help us improve CREN and
make it the leading medium on the Croatian real estate market.
Editorial staff: Vladimir Filipović – editor-in-chief, Petra Grgurić, Marija Noršić, Petra Škevin
and Natalija Vulić.
24

- CREN - Croatian Real Estate Newsletter

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