This is in line with, if not marginally better than European results where the decrease was 62% YoY (according to MSCI). Predicting market activity for the remainder of the year, given current conditions, is challenging but estimate it could reach €5.0 - 6.0 billion at the current trajectory.
The first quarter of 2023 ended with a total value of investment transactions worth €120 million in Romania, almost double y/y, with industrial and logistics accounting for about 50% of volumes and office for some 40%, Colliers revealed in its latest “CEE Investment Scene Q1 2023” report.
Romania outperformed the CEE, with the total for the six major economies (Bulgaria, Czechia, Hungary, Poland, Romania, Slovakia) more than halving.
Overall, the Central and Eastern Europe (CEE) investment flows were down by almost 57% in Q1 2023, at about €1.3billion, marginally better than European results where the decrease was 62% y/y (according to MSCI).
The industrial and logistics sector was dominant in Romania in the first quarter of 2023 in terms of transactional activity, with a share of 50% of the total volume of investments, followed by office spaces with some 40%.
Bucharest has some of the highest yields in the region for the industrial sector (7,5%), compared to at most 4.75% in Prague, 5.25% in Warsaw or 6% in Budapest.
“The outlook remains quite mixed: while we are starting to have more clarity on inflation, this does not necessarily mean more clarity on financing interest rates. Growth for the 2023-2027 period is estimated at a bit below 3% for the CEE-6 region, which is still almost double the Eurozone’s, but a recession is still a real risk scenario to keep track of. Inflation in the region has peaked and is set to sharply come down over the next few years and return to low single digits by 2025," said Anca Merdescu, Director Investment & Debt Advisory at Colliers.
