Share: Share on Facebook Share on Twitter Share on LinkedIn I recommend visiting cushmanwakefield.com to read:%0A%0A {0} %0A%0A {1}

Czech Republic MarketBeats

Marie Baláčová • 5/9/2022

The Russian invasion of Ukraine is putting businesses in the Czech real estate market in a difficult position again: pushing up inflation, interest rates and overall uncertainty. The impact of war on the Czech economy will be significant due to a high reliance in the economy on Russian oil and gas, migrant workers in the construction and logistics sector and further disruptions of the supply chains. In 2022, GDP growth in the Czech Republic is expected to reach 2.6%, the lowest rate in the CEE region, while inflation could exceed historical levels at 13.1%. However, according to the latest forecasts, the negative trends should not continue in 2023. Moreover, the unprecedented situation and the severe economic sanctions can lead to opportunities in the CEE markets, including the creation of new jobs, additional labour, and consumers.

Industrial

Over 306,000 sq m of warehouse space was newly completed within twenty industrial parks in Q1 2022, with more than 1.4 million sq m planned to be finished by the end of 2022. The industrial stock is thus nearing 10 million sq m. The vacancy rate is minimal, and the high demand causes rental growth in all regions.

Office

The new office supply in 2022 is expected to exceed the relatively low level of the previous year. Leasing activity exceeded the five-year quarterly average. However, limited absorption of the newly supplied office space led to an increase in the vacancy rate in Prague. Rents increase in the city centre and some outer city locations driven by new projects.

Retail

The performance of the shopping centres remains solid. While the sales exceeded the levels reached in Q1 2019, the number of visitors kept lower than pre-pandemic. On the other hand, real retail sales growth was limited due to the high inflation. The retail development currently focuses on smaller retail parks; however, some shopping centre extensions are also in the pipeline.

Investment

The Czech property market is still defined by the limited number of properties available for sale. Due to ongoing evolution in critical parameters like rental levels, indexation, financing, operating, and construction costs, the market faces a high level of uncertainty. However, sectors, submarkets, and properties whose downsides are naturally hedged by the upsides are resilient even amid this volatility.

Hospitality

Continued restrictions led to constrained hotel performance in H1 2021, which recorded an occupancy of 6% and ADR of €55. Nonetheless, performance has been picking up even with a partial lifting of restrictions, with RevPAR in June reaching 41% above the same month last year, generating optimism for a healthy post-COVID market recovery once restrictions are fully lifted. Accordingly, investor interest in hotels is returning and the gap in buyer-seller expectations is narrowing, however the number of hotel assets being put on the market in Prague remains limited, partially due to owners’ misconceptions that now is not the right time to sell.

 

Get the full Czech Republic property market picture with all the market data by downloading the reports.

Current Marketbeats

Loading bay, Contera, Teplice, Czech Republic
Czech Republic Industrial Data

Industrial Marketbeat is a summary of the Czech Republic industrial property sector providing comment on recent trends as well as market data and analysis.

Download

Karlin, Prague, Czech Republic
Prague Office Data

Office Marketbeat is a summary of the Prague office property sector providing comment on recent trends as well as market data and analysis.

Download

Square, central Prague, Czech Republic
Czech Republic Retail Data

Retail Marketbeat is a summary of the Czech Republic retail property sector providing comment on recent trends as well as market data and analysis.

Download

people at desk hands only
Investment Data

Investment Marketbeat is a summary of the Czech Republic office property sector providing comment on recent trends as well as market data and analysis.

Download

Hotel Prague
Hospitality Data

Hospitality MarketBeat is a summary of Prague's hotel property sector providing comment on recent trends as well as market data and analysis.

Download

With your permission we and our partners would like to use cookies in order to access and record information and process personal data, such as unique identifiers and standard information sent by a device to ensure our website performs as expected, to develop and improve our products, and for advertising and insight purposes.

Alternatively click on More Options and select your preferences before providing or refusing consent. Some processing of your personal data may not require your consent, but you have a right to object to such processing.

You can change your preferences at any time by returning to this site or clicking on Cookies
MORE OPTIONS
Agree and Close
These cookies ensure that our website performs as expected,for example website traffic load is balanced across our servers to prevent our website from crashing during particularly high usage.
These cookies allow our website to remember choices you make (such as your user name, language or the region you are in) and provide enhanced features. These cookies do not gather any information about you that could be used for advertising or remember where you have been on the internet.
These cookies allow us to work with our marketing partners to understand which ads or links you have clicked on before arriving on our website or to help us make our advertising more relevant to you.
Agree All
Reject All
Save settings

NEMŮŽETE NAJÍT, CO HLEDÁTE?

Obraťte se na jednoho z našich profesionálů.