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What real estate assets are investment-attractive in Ukraine: results of MIPIM 2017

23 March 2017 | Thursday
URE Club

The conclusions of the participation of the Kyiv Stand on the international property market MIPIM were drawn on the 23rd of March in Kyiv. Within press-conference, organized by Ukrainian Real Estate Club (URE Club) in the Interfax-Ukraine news agency, top managers of the companies, represented on the Stand, shared their market experience, whether it met their expectations and discussed investment perspectives of Kyiv.


This year, MIPIM was visited by 24,200 participants, including 5000 investors, mentioned Dmytro Dopiro, a representative of Reed Midem in Ukraine. Ukrainian delegation was represented by 60 guests, among them are agents of DLA Piper Ukraine, DTZ Ukraine, UTG, Alfa-Bank Ukraine, Taryan Group, N&D Law Firm, UDP. 

According to Oleg Svitlychny, deputy head of the Department of economics and investments of Kyiv City State Administration, this year Kyiv mainly presented infrastructure, transport and industrial projects of the city, including the industrial park "Kyiv business-harbor". Furthermore, sports and recreational projects were also represented at MIPIM, which were of interest to investors. 

Irina Skorokhodova, vice president of Alfa-Bank Ukraine, outlined the key drivers of successful participation in MIPIM. In her judgement, these are the product of interest to investor and the meetings with potential partners, fixed in advance, often half a year before the event. As of today, Alfa-Bank together with Ukrsotsbank have in possession 400 real estate objects with a total cost of $ 300 million. Top 10 of these objects, including an operating business center and land plot on the Desyatynna street were presented at the market. Among international investors there are those, who know exactly, what they want to buy in Ukraine, mentioned Irina Skorokhodova.

According to Nazar Burda, commercial director of Taryan Group, the development company, which presented residential complex JacK House in Kiev, investors demonstrate insular interest in Ukraine and Kyiv. This interest is due to the fact that real estate objects in Ukraine are more profitable than in developed European countries: investing in European projects, investors can expect a 4-8% profit per annum, while such figure for some projects in Ukraine transcends 30 %.

This view was confirmed by Volodymyr Mysak, director of capital markets of DTZ Ukraine. In his words, international investors started looking for more profitable markets. And today the real estate investment attractiveness of Ukraine has prospects for growth.

Sergiy Zaika, business development director of UTG, noted that even 6-7 years ago Ukraine was included in the list of 10 most attractive countries for investors. Today the situation has changed, but the investment potential of Ukraine holds true, and it is important to bring this information to the foreign investors. Foreign developers are also interested in entering the Ukrainian market. According to Sergiy Zaika, the companies, which already had experience in the Ukrainian market, intend to invest in Kyiv, the representatives from Poland and Turkey dominate among them. Potential investors actively monitor the situation in Ukraine and are waiting for the moment, when foreign companies will come on Ukrainian market.

Nataliya Kochergina, head of real estate and partner of DLA Piper Ukraine, has observed that large investors are also interested in Ukraine, for this reason it is extremely important for our country to be represented at such site as MIPIM. Herewith, the expert emphasized that five years ago, when joint stand of Ukrainian cities was presented at MIPIM, it was much popular. Today international investment funds are looking into the industrial estate of Ukraine, in particular, the companies, which own several industrial objects, so Nataliya Kochergina believes that industrial property of Ukraine has a great potential. She also drew attention to the fact that the recent investment in real estate markets of Eastern Europe - Poland, Hungary and Romania - were extremely intense, resulting in oversaturated markets of commercial real estate.

In addition, press conference participants identified the main trends, that are reflected in the projects, presented at MIPIM 2017, and according to the speakers, would not be confined in the next few years. Including:

- parks and squares on the roofs and terraces of residential buildings, construction of which is caused by the limited free space for the development;
- complex programs of regions and cities development, which are gradually replacing some real estate projects, the growing popularity of the "city within a city" concept;
- energy efficient technologies and "green" construction;
- the impact of online trading on the sector of commercial real estate and an increase in entertainment component of commercial objects.

Experts are unanimous: to make investment prospects of Ukraine real, it is essential to all-out inform investors on the state of the property market in Ukraine, especially through such site as MIPIM.

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