Page 59 - UKRRptJul21

collapse of the offices that scared everyone at the start of the pandemic did not take place,” he said. “According to a study conducted by CBRE in 2020, 73% of those surveyed want to return to the office and have a hybrid work format.” This year, 12 business centers with a total area of 207,000 square meters are to open in Kyiv.
Ukrainian housing prices increased by 10% during the first half of this year, reports 1+1 TV’s Tyzhden. In Dnipro prices rose 21% and in Khmelnytsky by 22%. Analysts cite several factors for the buying pressure: low supply, low interest rates, the hryvnia’s 5% appreciation against the dollar, and restrictions on foreign travel due to coronavirus.
Commissioning of housing increased by 20.5% during the first quarter,
compared to January-March 2020, the State Statistics Service reports. Of the 2.3 million square meters, 70% was in urban areas. Kyiv city accounted for 6%, or 145,000 square meters.
The warehouse and logistics market weathered the pandemic gracefully but there is now a shortage of space. After vacancy rates dipped to 0.8% in 2019, developers rushed to add 85,000 square meters of warehousing and logistics property in 2020, the largest increase since 2014, according to Cushman & Wakefield, a real estate firm.
But the current supply of roughly 2mn square meters of warehouse and logistics space is still not enough to meet demand as large retailers increase their inventories and go digital and e-commerce continues to grow. Low rents and a lack of proper debt financing, however, are discouraging developers.
Despite the downturn last year, demand for warehouse space went nowhere. In 2020, firms in Ukraine leased 160,000 square meters of new warehouse space, according to CBRE Ukraine.
Vacancy rates have therefore plummeted to around 1.8% in the Kyiv metropolitan area from 2.9% at the beginning of the year. Vacancies next to highways are near zero, an obvious sign of high demand and a dire lack of space, according to CBRE Ukraine.
Cushman and Wakefield says that a third of all lease transactions in 2020 in the Kyiv metropolitan area were pre-lease agreements for warehouse and logistics space.
According to Cushman & Wakefield, another 75,000 square meters are planned for 2021. There are also plans to add nearly 300,000 square meters of warehouse and logistics space, but some of those projects may not cut the ribbon until 2025.
Total investments in warehouse real estate amounted to a measly $4.3mn in 2020, an 86% decrease year over year, according to CBRE.
Not all developers are so shortsighted. Dragon Capital, one of Ukraine’s largest investment firms, just purchased the 100,000-square meter Amtel Complex outside of Kyiv. In total, Dragon Capital owns nearly 400,000 square meters of warehouse and logistics properties. The firm is also planning a 200,000-square meter E40 industrial park
59 UKRAINE Country Report July 2021 www.intellinews.com