Review of Ukraine’s Real Estate Market in 2015

In 2015, investments into commercial real estate dropped significantly. Most of the facilities to be commissioned in 2015 were pushed back to 2016-2017. New projects appeared in residential real estate only.

In the retail real estate segment, 2015 was marked by a drop in the new rented space and rental rates fixed below market.

During the year, three new shopping malls were commissioned in Kyiv with the total rented space of 30,700 sq. m, as well as a 10,400 sq. m shopping mall in the market format.

Five shopping malls were commissioned elsewhere in Ukraine: two in Odessa, one each in Lviv, Chernihiv, and Khmelnitsky.

Compared to 2014, average attendance of shopping malls decreased by 12.1%. Vacancy dipped by 1.5% and averaged 6%.

Rental rates fluctuate between $25 and $80 per sq. m per month.

Kyiv’s office space expanded in 2015 by 10 new business centres with a total area of 74,500 sq. m. Nine of them are Class B and one business centre in Antonovycha St. is Class A.

According to UTG, office space vacancy grew by 2.5%, reaching 24% on average (30% – in Class A and 23% – in Class B business centres).

Rental rates in Class A business centres fluctuate in the $17-29 per sq. m per month range, while those in Class B – in the $7-20 per sq. m per month range.

85% of the residential real estate supply in 2015 came from the low-cost segment, with the supply structure dominated by single-room and studio apartments.

While prices in hryvnia grew by about 35%, prices in USD dropped by 10%. The number of investment transactions fell to its lowest and is about 10%.