What awaits commercial real estate in Kiev in 2020: expert forecast
Commercial real estate in Kiev in 2020 will continue to develop rapidly. Experts agree that now there are favorable conditions for business development and, accordingly, this has a positive effect on the situation in the office and retail real estate market.
What will happen in 2020, the portal of the capital real estate 100realty.ua recognized.
Office Real Estate – Rising Rates and Coworking Competition
Experts predict high demand for offices in Kiev and at the same time moderate supply, which will affect rental rates. According to Alexander Nosachenko, managing director of Colliers International (Ukraine), in connection with the commissioning of new high-quality interesting office real estate objects, tenants may have a wider choice. At the same time, against the background of a significant volume of pent-up demand, vacancy in the office space market will not increase significantly, and rental rates may continue to continue moderate growth within 10%.
Related article: What will happen to the prices of apartments and new buildings in Kiev in 2020: forecast from market experts
Irina Trunova, head of the valuation and consulting department of NAI Ukraine, agrees with the forecast regarding growth in rental rates.
“Rental rates for offices, given the fact that the announced new offer will not cover demand in a growing market, will increase. At the same time, demand for alternative office real estate will increase. It is possible that next year, market experts will begin to more deeply analyze rates for coworking, which will be recognized as a full-fledged competitive part of the office real estate market, ”the expert says.
She also added that among the expected events in the office real estate market in 2020 is the appearance of large new projects of Class A business centers. Such objects are very popular on the market – in recent years, a new offer was made up exclusively of class “B” office centers.
offices in Kiev
How the office real estate market developed in 2019 – shown in the presentation
Most likely, the office real estate market will develop non-linearly, new brands of service offices may appear on it (for example, in 2019, the IWG international group introduced the Spaces brand to Ukraine – the first coworking was opened by Maidan Plaza).
Retail real estate – rapid growth in supply
Despite the fact that the retail real estate market in Kiev is actively developing and the offer is becoming more diverse, the rates will be kept at the current level.
Related article: Results of 2019 on the real estate market of Kiev: the market is “stormy”, prices have changed significantly
“The rapid increase in the supply of high-quality retail space will not lead to a collapse in prices – in the best shopping centers, rates will rise. However, in facilities that are losing popularity or are forced to reconcept to stay afloat, rates can be reduced in an attempt to retain or attract operators, ”says Irina Trunova.
On the market of retail real estate in Kiev in 2020 it is expected to commission new shopping facilities:
second stage Lavina Mall, etc.
shopping centers in Kiev
How the retail real estate market developed in 2019 – shown in the presentation
Competition between these projects, as well as new shopping centers opened in 2019, can lead to a redistribution of customer flows. “Most likely, we will see great marketing activity from the mall. It is also expected that new international brands will come to Ukraine – these may be premium and middle-fashion brands, restaurant chains, DIY and beauty brands, ”says Trunova.
The main trends in the commercial real estate market in 2020
As for the main trends in the commercial real estate market in 2020, this, according to experts, is a change in approach to the concepts of objects.
“We can highlight the main trends that need to be taken into account in the design of new and reformatting of existing shopping centers: enlargement, socialization, as well as two related to the digital era: digitalization and omnichannel,” notes Alexander Nosachenko.
All four trends are explained by increased competition between existing shopping centers, but to a greater extent – the expectation of future changes in the coming decades.
“In particular, in the past year, we observed the reconstruction of obsolete facilities, the search for new formats and solutions. The “Caravan” shopping center decided to reconstruct and change the format; in the near future, a number of updates to existing facilities, opened 10-15 years ago, are expected. In addition, it must be borne in mind that approximately 90% of the new supply of retail space in the capital, both open and announced –