RESEARCH INVESTMENT MARKET

Transcription

1 RESEARCH INVESTMENT MARKET Q1 16

2 INVESTMENT MARKET Q1 16 3mln COMMERCIAL REAL ESTATE TRANSACTION VOLUME IN Q1 16 Commercial real estate market has experienced a times transactions volume drop (compared to Q1 15) to 3 mln in Q1 16 INVESTMENT MARKET Q1 16 exhibited the lowest quarterly value on record of the volume of purchase transactions. Institutional investors were passive due to the volatility of the Russian national currency, lack of quality assets, as well as the limited financing possibilities of banks. An additional constraint of market activity was the uncertainty of the economy recovery perspective. Market participants initially expected rapid growth after hitting the bottom in a similar way to 8 9 crisis period, but now the recovery prospects are less optimistic. The volume of transactions in the Moscow region has amounted to only 15 million the lowest quarterly level since 6. The share of transactions in regional cities was 3% (8 million), where not a single transaction was completed in the same period last year. However, it is too early to highlight an increase in interest to investment assets outside the Moscow area. Thus, only few transactions were closed in January March 16, some of them were disposed by tender or sold by previously announced portfolio sale. TRANSACTION VOLUME DYNAMICS IN TERMS OF THE CAPITAL INVESTED Foreign investors Russian investors 66% 71% 86% 53% 78% 61% 83% 8% 7% 3% 86% 9% 17% % 1% 39% % 1% F TRANSACTION VOLUME DYNAMICS IN TERMS OF THE SEGMENT Offices Warehouses Hotel Retail Nat capital outflow F -5-1 Source: Knight Frank Research,

3 INVESTMENT MARKET Q1 16 In the current environment investors are interested in already existing facilities with stable rental income. In turn, the volume and number of purchase transactions for further redevelopment has dropped: the decline was 8% against Q1 15 and 93% against Q1 1. INVESTMENT MARKET INVESTMENT VOLUME AND AVERAGE TRANSACTION SIZE DYNAMICS mln 1, 1, mln 1 1 1, 8 16% % 36% 8% 98% 1% 33% 6% 61% Q1 1 Q1 13 Q1 1 Q1 15 Q Transaction volume, Moscow region Transaction volume, other regions Average transaction size VOLUME OF CREDITS ISSUED TO CONSTRUCTION COMPANIES AND OVERDUE CREDITS VOLUME DYNAMICS trln rub Credit volume Overdue credit volume Q1 1 Q1 11 Q1 1 Q1 13 Q1 1 Q1 15 Q1 16 With a lack of economy advance Q1 16 indicated further increase of overdue loans volume. Building sector is reported to be one of the leading in terms of overdue credits volume. Furthermore, a number of developers asking for loans restructuring is growing. EUROPEAN COUNTRIES INVESTMENT VOLUME COMPARISON UK Germany France Sweden Netherlands Italy Spain Norway Finland Ireland Denmark Poland Switzerland Czech Republic Belgium Portugal Austria Romania Russia 16,9 11,1,5 3,3,98,86,71 1,89 1,99 1, % -8% -% -36% -6% -6% +135% -9% -33% +59% -61% -53% -33% -56% -66% +68% -5% % -36% Real estate investment volume, Change compared to Q1 15-3% Source: Knight Frank Research, 16

4 INVESTMENT MARKET Q1 16 OFFICE MARKET SALE PRICE Class A,5 5, /sq m 1, 3, rub./sq m Class B 1, 3, /sq m 8,, rub./sq m PRIME YIELD Class A % Class B % Despite a number of office investment deals negotiating in Q1 16 no investment transactions were closed in the Moscow region. Market has experienced a similar situation a few times on a developing stage. However we expect investments in office real estate segment to reach 1.5 bln in 16 (3% increase compared to 15) OFFICE SEGMENT INVESTMENT VOLUMES AND GDP GROWTH DYNAMICS F Office market investment volume, GDP growth, % % RENTAL RATES IN THE MAIN BUSINESS DISTRICTS OF MOSCOW Kremlin district Central business district (Garden Ring) Paveletsky business district Belorusskiy business district Leningradskoe direction 55 5, , 3, 1, 35, Moscow-City South-Western direction 6 8, 3, ,,, 3, Rental rates , 3, /sq m/year (triple net) rub./sq m/year (triple net) Source: Knight Frank Research, 16

5 INVESTMENT MARKET Q1 16 RETAIL MARKET THE DYNAMICS OF INVESTMENT IN RETAIL MARKET OF RUSSIA AND CONSUMER CONFIDENCE INDEX (CCI*).5 PRIME YIELD % 3.5 % F -35 Retail investment volume Consumer Confidence Index * CCI is an indicator designed to measure consumer confidence, which is defined as the degree of optimism about the state of the economy that people express through their consumption and savings. Determined on the basis of quarterly surveys by Rosstat in all regions of Russia, CCI is the relative value of the number of positive and negative responses from the total number. RENTAL RATES IN SHOPPING CENTERS OF MOSCOW Goods for children (1,, sq m) Rental rate: 6, 15, rub./sq m/year The share paid based on turnover: 8 15% White & Brown (1,3, sq m) Rental rate:, 1, rub./sq m/year The share paid based on turnover:.5 % Entertaiment (1,, sq m) Rental rate: 6, rub./sq m/year The share paid based on turnover: 1 13% Footwear (3 5 sq m) Rental rate: 35, rub./sq m/year The share paid based on turnover: 7 1% Apparels ( 1, sq m) Rental rate: 3, rub./sq m/year The share paid based on turnover: 1% Sporting goods (1, 6, sq m) Rental rate: 1, rub./sq m/year The share paid based on turnover: 8 1% Hypermarket (>7, sq m) Rental rate: 1, rub./sq m/year The share paid based on turnover: 1.5 % DIY (>5, sq m) Rental rate:, 6, rub./sq m/year The share paid based on turnover: 9% * Commercial terms discussed during negotiation process Source: Knight Frank Research, 16

6 INVESTMENT MARKET Q1 16 WAREHOUSE MARKET SALE PRICE, 5, rub./sq m PRIME YIELD % PNK-Chekhov 3 and PNK-Severnoe Sheremetyevo investment transaction was the largest in Q1 16, as well as the first transaction closed with Mddle-Eastern investor. RENTAL RATES AND VACANT SPACE IN TERMS OF DIRECTION Vacancy rate WEST 5% 5 1% 1 15% over 15% NORTH- WEST INDUSTRIAL SEGMENT INVESTMENT VOLUME DYNAMICS NORTH,, ,,8 SOUTH-WEST,3, F MKAD Moscow SOUTH NORTH-EAST,,5, 5, 3,7,5,8 3,5 3,,3 EAST SOUTH-EAST, 5, Asking rental rates, rub./sq m/year Knight Frank 16 This overview is published for general information only. Although high standards have been used in the preparation of the information, analysis, view and projections presented in this report, no legal responsibility can be accepted by Knight Frank Research or Knight Frank for any loss or damage resultant from the contents of this document. As a general report, this material does not necessarily represent the view of Knight Frank in relation to particular properties or projects. Reproduction of this report in whole or in part is allowed with proper reference to Knight Frank. 6 Valovaya Street Lighthouse BC Moscow 1155 Russia +7 (95) 981 KnightFrank.ru