Investments in environmental projects are measured in billions, and half of those investments are in Europe. Therefore, this segment should attract the attention of investors, not only as a business opportunity, but also as a chance for a greener environment.
This is one of the conclusions of the Sixth Serbian Conference on Real Estate and Infrastructure Development, which was held online.
Milan Elezovic, General Manager of Credit Suisse, pointed out that investors are increasingly counting on our region, which, as he stated, is “on everyone’s radar”. The advantages of Belgrade were stated by Michael Roskelly, CEO of Cadenza Principal Finance, who said that this is a market that has development opportunities, and that economic transformations and reforms are visible, which attract investors.
– Belgrade is the capital of the region. Construction in this city is an encouragement for investors, because the market absorbs it. On the other hand, the challenge is how to find a good location at a good price, but also the choice of contractor. There is also the risk of financing, as well as legal and political challenges, due to which we have to convince investors that they can overcome them – he added.
Stefano Maio, in charge of business development at Bechtel Civil Infrastructure, added that Serbia’s advantages are political security, growing GDP, good credit rating, bilingual population, smart engineers, quality workforce, and quick obtaining of building permits.
Vojkan Brankovic, founder and executive director of the company Apeiron from Great Britain, paid special attention to the south-east of Serbia, talking about solar energy and wind energy. He mentioned that support is sought for such projects, because he sees the perspective in sustainable development.
– The problem is that it is difficult to identify enough suitable land, which is owned by the state or local self-government. It is necessary to work with large institutional partners – he stated and added that he expects that it will take several more years, due to the risks that this region is considered to carry.
Ana Lukovic, an independent lawyer in the office of Karanovic & Partners, assessed that the real estate market is dynamic, and that digitalization is important for this sector in the future.
Trends and issues when it comes to financing
The housing market recorded a turnover of 2 billion euros last year. In addition to the real estate market, the infrastructure market is also growing, and prices have jumped drastically, said Ervin Pasanovic, CEO of Adventis Real Estate, adding that no reduction in investment is expected.
Vasilije Jaukovic, in charge of the property and tourism sector in the EBRD, pointed out that the pandemic accelerated the inevitable trends and added that one of them was the development of industrial zones. However, the challenge is to find satisfactory tenants.
– When it comes to office space, there are no major changes, new projects are expected to stop this year. I believe that the “hybrid” approach of working from home and from the office will continue – he stated.
He also believes that the market for green projects is growing.
Vladimir Veselinovic, head of real estate finance at UniCredit Bank Serbia, noted that the completed office buildings have a lower degree of issuance, but that a long-term problem is not expected.
– Stable growth of residential construction is expected. Prices are at a stable level, and the financing parameters are similar in the entire region – he stated.
Infrastructure is a strong mechanism to achieve economic development, believes Vladislav Cvetkovic, director at PWC Serbia, and states that in this way investments are stimulated, but also the goals of sustainable development.
– We have two goals: to fill the gaps in the infrastructure and go to investments that can meet the goals of sustainable development. The green agenda will be important for attracting investors – he pointed out.
He also mentioned that these topics will determine how investments will be directed, as well as that it is necessary to become more attractive for private money, ie private investments.
Commercial projects, logistics and retail
The financial situation is quite good, the interest rate is low, the values of real estate are stable, and those in the field of logistics are growing, said Nebojsa Nesovanovic, director at CBRE.
– The biggest losers are hotels, shopping malls and office space – he added.
He pointed out that the residential real estate market is becoming more and more attractive and that these investments are viewed as capital. He also stated that the return on investments in shopping centers is expected.
He said that it is necessary to listen to clients, research, be proactive, and that the real estate sector is entering the digital era.
– The office market is changing, Covid has accelerated this process. The office itself will have to undergo changes, especially when it comes to the one that is less attractive to go to – said Nesovanovic.
Roman Klott, CEO of Atrium, noted that the market will change, but that offices will not become redundant.
– Companies will have different offices in larger cities, ie not everything will be in one place. This is an opportunity for service companies, which provide cleaning and disinfection services, to expand their business, but also for those that provide IT services – Klott believes.
Ivan Gazdic, President of the Committee for Real Estate and Construction at the Council of Foreign Investors, pointed out the risk for investors from the possibility of a state of emergency, as well as in relation to the behavior of buyers. He added that attention should be focused on retail parks in logistics, and that banks will not be interested in investing in office space.
– What is needed is flexibility between seller and buyer. We are also moving towards green construction and environmental principles, which will be more attractive for financing – he added.
Milica Mitrovic from the company GTC S.A. she pointed out that companies increasingly want to commit when it comes to renting space, and that these decisions are made faster than at the beginning of the pandemic.
– The rental rate has dropped a bit, but the rent collection is excellent – she pointed out, eKapija reports.
