11:45 20.12.2012

Western investors are skeptical about purchase of retail and office facilities in Kyiv, says expert

2 min read

Ukrainian groups are mainly interested in acquisitions of retail and office property in Kyiv, while western investors are skeptical about investing into the Kyiv's property market, a managing director of Colliers International Consulting Company in Ukraine, Oleksandr Nosachenko, has said.

"If we look back and see who earlier bought [retail and office] assets, many foreigners and investment funds from the west bought assets earlier. Today foreigners are very skeptical about acquisitions [in Ukraine]. If the deals are signed, they will be signed by Ukrainian groups, partially by Russian groups and we will see a western player as an exception," Nosachenko said at a press conference in Kyiv on Wednesday.

He also said that the Russian interest to the finished projects is overestimated, and in reality, there are fewer Russian groups compared to Ukrainian ones which are eyeing the purchase of finished projects in Ukraine. Foreign investors show their interest to acquisitions of projects in Ukraine mainly with the purpose of diversifying their portfolios.

Nosachenko also said that the main interest of investors is focused on the functioning shopping centers.

"If we speak about the operating centers, shopping centers arouse the main interest of buyers: if the vacancy rate is around 2% this means that money flow generated by a shopping mall is interpreted as a very stable one in the long-term outlook. The office segment is traditionally second after retail property… following the retail segment far behind," he said.

He said that the best A class offices centers located in high streets are considered good for acquisitions.

"If the market sees two large deals with large assets [in 2013], it would be good for the market," he said.

Commenting on information that the Globus shopping mall and Hyatt Regency Kyiv Hotel in Kyiv are put up for sale, Nosachenko said that it will be not easy to sell the hotel, while the potential of the Globus has been already realized.

Collіers Іnternatіonal is an international company providing services in the sphere of commercial real estate. It unites over 12,300 specialists, working in 522 offices in 62 countries.

The representative office of Collіers International in Ukraine was established in Kyiv in 1997.

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