Damian Harrington, Regional Director of Research for Colliers International, Eastern Europe, said if the second half of the year was to match the activity of the first half, the value of transactions for the year could seemingly reach more than €10 billion, which is a very positive sign.

The value of transactions for the top twenty largest deals in the region since post-crisis is circa  €10 billion; this is almost one third of the total €33 billion transacted since 2009.

The total value of transactions to date indicated the region was growing its transaction capacity to near pre-global financial crisis levels. It was important to consider the number of transactions to get a clearer picture of how investment activity is changing.

Whilst recorded volumes point towards a recovery in transactional activity in 2013, the number of deals actually conducted suggests a gradual slow-down in activity is a more accurate depiction of what has happened following the post-crisis peak in 2011. Deals continue to take a long time to process and investors are targeting specific investment locations within Eastern Europe for their purchases.

Investment activity remains focused primarily on Russia, Poland and the Czech Republic, which accounted for more than 80 per cent of all transactions during the last four and a half years.

With a growing number of investors targeting these markets, competition for Core and Core plus assets will increase.

Ultimately, investors will need to move up the risk curve in order to drive investment activity and satisfy their investment appetite. They will seek out opportunistic assets within the safe haven markets, Russia, Poland, and the Czech Republic.

However, as competition increases in these safe haven markets, investors will need to adjust their investment strategy and consider expanding their geographic horizons into the more peripheral markets of Eastern Europe where suitable core product can be found.

A slightly different risk will need to be priced in but we have already noticed an increase in closed transactions in Slovakia during the last six months and active interest in other peripheral markets is also increasing, most notably in Romania.The report found that investment volumes by country pre and post-crisis crisis had changed significantly.


While appetite has increased considerably for core/core plus assets located in Russia and Poland, Hungary has suffered a decline in post-crisis fundamentals, reducing the overall attractiveness of the market to overseas investors, despite benefitting from a strong portfolio of commercial property assets.

“With a general improvement in economic conditions forecast for peripheral economies of Eastern Europe and product availability drying up in other locations across Europe, the more peripheral Eastern European markets may witness an upturn in activity sooner rather than later,” said Mr Harrington.

Good investment product exists in the more peripheral Eastern European markets and with timing to buy optimum; increasing levels of capital will be attracted to these markets. Pricing the risk of investing in these locations will still determine their long term success.