"Everything is going to be fine in the end. If it's not fine it's not the end."
The ubiquitous pandemic is leaving visible traces in the real estate industry as well – nevertheless, it is important to stay confident and look ahead, because even times of crisis always harbor new opportunities.
The Austrian real estate market remains attractive for investors due to its stability and predictability, especially in times of crisis, and has gradually picked up speed again after a weak first quarter. The proportion of international investors and the demand for asset classes such as residential, office and logistics remain high. After a record year in 2019, the hotel industry was hit with full force by the crisis, and due to the lack of overnight stays (mainly of international tourists), some developers are rethinking their planned developments or adapting the mix of uses accordingly.
In the office market, the lockdown at the beginning of the year caused a historic low in lettings, and the market is slow to recover. Home office has become indispensable in many companies – as a result, tenants are increasingly concerned about the office space actually required, and demand greater flexibility when drafting contracts.
The retail market is fueled by hope – and newly available spaces are causing movement, especially in prime locations, which are in high demand despite the crisis. The rental prices remain stable. State capitals benefit from the high proportion of local customers, but the increasing pressure is nevertheless becoming visible in some vacancies.
Industry and logistics clearly show the changes in consumer behavior – the continuous increase of annual sales in online retail leads to an equally increasing demand for appropriate storage space. Together with increasing parcel volumes, the “last mile” is becoming more and more relevant in city logistics. The greater Vienna area remains the most important logistics market in Austria.
The retreat into private spaces has gained importance and living needs are subject to constant change: private homes are mutating into a multifunctional mix of school, office, home and restaurant. Open spaces and opportunities for outings and exercise in the immediate vicinity are becoming increasingly important.
Overall, it is clear that the crisis has not yet been overcome – but at least the first signs of a trend reversal are visible. That is why the experts at Colliers International stand with Oscar Wilde: Everything is going to be fine in the end. If it's not fine it's not the end.