GTC International Poland, GTC Serbia

Real Estate Industry

Real Estate Industry
GTC International, Poland



There are, of course, many reasons for entering a new market. Serbia presented both a challenge and an opportunity for GTC. Firstly, as it is an emerging market, one of the principle reasons is that we perceived a large gap in the real estate sector and a need for more offices, hotels, shopping malls, and quality mid-to-upper level residential buildings. Choosing to come here also reflected our confidence in Serbia in terms of opportunity, resources, and skilled workers.



The world of business buildings is one which has a very long-term vision of the future. The needs of today are of critical importance, but those of tomorrow are paramount. GTC has seen in Belgrade a vision of a major European center of commerce, business, industry, and transport. Belgrade is in the very heart of the Balkans and at the epicenter of all movement throughout South East Europe. As the importance of Belgrade grows, so too will its requirements for office space and business parks.



GTC HOUSE is the first of GTC International's investment in Serbia. The building, completed in April 2005, appeared as the long anticipated building offering class A office facilities for leasing to the leading international companies in Belgrade. The modern building is fully equipped with all high-tech facilities, sophisticated telecommunications, and elegant double height entrance lobby leading into a covered central atrium.



Our new office project 19Avenue will consist of two 1st class office buildings with a unique design of 20,000 sqm. The 19 Avenue will be completely equipped with high-tech telecommunication devices, offering not only exceptional working environment, but also facilities such as a restaurant, bar, storage and underground garage.



Other GTC International's projects include GTC Square and Park Apartments. GTC Square is the newest innovative office project located in New Belgrade, with ample parking space, an open interior courtyard overarched by translucent catwalks, and an expansive and majestic atrium. Park Apartments is a top of the range residential building introducing a new concept of living, with 200 apartments, 2-level underground parking, retail stores, fitness center, 24-hour reception desk, security services, maintenance services on the spot, and a video interphone.



This is a very exciting time to be doing business in Serbia. In the context of its transition, Serbia has launched itself resolutely onto the path of joining the rest of Europe in terms of its economy and business. Foreign investment continues to come into Serbia from across the spectrum of industry sectors: banking, telecommunications, and, naturally, construction. Investors continue to view Serbia not only as an important investment destination in itself, but as a gateway to the region as well. We at GTC are committed to open and transparent business practices, and have been very encouraged by the country's efforts to align itself with the best practices for business development as witnessed in the EU and neighboring countries.



In short, we are very optimistic about the business climate in Serbia and have already experienced many of the benefits of investing here.



Mr. Robert Snow, Managing Director, GTC Serbia

Serbian Property Market

Balkan property blossoms, large investors still missing - Merrill Lynch
17:16 Fri 07 Mar 2008 - Anelia Zaharieva


Serbia, being the largest country in Western Balkans, has a good investment potential but entrepreneurs will have to wait until they see how it will develop in political aspect, especially with regard to EU accession. Local analysts think that the 880 million dollars direct investment in business property in 2006/2007 is only a small part of Serbia’s potential.

The Central Europen division of Global Principal Investment (GPI), Merrill Lynch's commercial real estate investment arm, plans to invest 550 million euro in real estate in Serbia, jointly with local firm MPC Properties, in which Merrill Lynch holds the minority stake, Reuters reported.

Residential property market on the Balkans was blooming after the region’s recovery from the war and the subsequent stagnation in 1990s. Nonetheless, large corporate investment will come only after real political stability is achieved, Robert Schweizer, GPI vice-president for Central European region, which covers all east of Germany, including Russia and Turkey, told Reuters.

The residential segment did not enjoy a lot of investment over the past 15 years in the Balkans, but the recent remarkable growth was expected to continue, outperforming the rest of Central Europe, Schweizer noted.

Residential prices in Balkan countries rose significantly over the last few years due to a number of factors, such as investment inflows, which spurred employment and economic growth, keen demand for housing space and short supply.

The land market, however was still under-developed because of the insufficient number of foreign players, who demand political stability. In light of this, the current situation in Kosovo serves as a deterrent, diverting a large chunk of foreign resources, Schweizer said.

Despite that, Merrill Lynch is extending its already established partnerships with local companies and has concluded deals for the development of commercial centres in Belgrade, Sarajevo, Zagreb and Skopje. The company’s strategy is to become a leading retail centre investor in the region, he noted, given the tangible effect of household income rise in the country’s capitals.

Serbia, being the largest country in Western Balkans, has a good investment potential but entrepreneurs will have to wait until they see how it will develop in political aspect, especially with regard to EU accession. Local analysts think that the 880 million dollars direct investment in business property in 2006/2007 is only a small part of Serbia’s potential.

Currently, Bulgaria and Romania are the Balkans’ front-runners in terms of foreign investment, owing to their EU membership, which renders political stability and a certain security of investment, Schweizer said.

www.propertywisebulgaria.com

Serbia Real Estate

Serbia Real Estate

Quick Introduction into the Serbian Property Market
Real Estate

* For the third consecutive year, Serbia was awarded as the largest Greenfield investment location in SEE by OECD.
* Total value of international real estate projects in 2005 reached $181 million, while in the first nine months of 2006 alone they amounted to $153 million.
* Office market shows clear signs of strong development.
* The net rental rates for Class A office premises in Belgrade ranges between €18-24 per sqm, while class B office space commands levels of €13-18 per sqm per month

Following the 2004 award for Investor of the Year in South East Europe (SEE) by the Organization for Economic Co-operation and Development (OECD) presented to Ball Packaging Europe (USA), Metro Cash & Carry (Germany) was the winner in 2005 and this year Airport City Belgrade (Israel) won as the largest Greenfield investment in the region.



Growing investment opportunities for international real estate developers in Serbia have been reflected in recent FDI figures. Total value of their projects in 2005 reached $181 million, while in the first nine months of 2006 alone they amounted to $153 million.



Prepared in cooperation with Colliers International

The Belgrade speculative office market shows clear signs of strong development. Since the beginning of 2005, the total inventory of Class A and B office premises increased by 18.5%, reaching its current level of 226,000 sqm of leasable area. It must be noted that the intense development of office inventory in Belgrade started after 2000, and that the presented market characteristics are directly influenced by the modest inventory size.
130,500 sqm of Class A and B office leasable space is located in Belgrade's Central Business District (which includes downtown and the central area of New Belgrade municipality), while the remaining 96,500 sqm is located in the wider center and suburban areas of the city. The largest number of new completions occurred in the area of New Belgrade, reinforcing its leading position in the overall country's real estate development.



Due to steadily increasing inventory, rental levels for Belgrade’s Class A and B office space have also recorded a slight but steady decrease during the past 12 months. The net rental rates for Class A office premises in Belgrade range between €18-24 per sqm per month. Net rental rates for Class B office space command levels of €13-18 per sqm per month depending on location, accessibility, parking opportunities and amenities. Through the end of this year, rents should remain at their current levels, but the slight decreasing trend is expected to continue during 2007. If take-up and development completions follow the expected growth pattern, there is a strong possibility for this decrease.



Sales prices stabilized during the second quarter of 2006 and recorded a marginal increase compared to previous years. An increase in prices is recorded in New Belgrade, especially in the blocks along Jurija Gagarina Street. In general, sales prices in prime residential areas range between €1,200 and €2,000 per square meter. Most of the projects marketed as prestigious properties have asking prices above €2,000 per square meter. However, due to various factors including quality and location, their absorption rates have remained modest.

Buying Property in Serbia

Being a country in transition with property prices still waiting to sky rocket, Serbia is an attractive location for buying relatively cheap property as a form of investment. This is an introduction into the real estate market in Serbia.

Can Foreigners Buy Real Estate In Serbia?

The ability of a non-Serbian individual to purchase real estate in Serbia is limited only by the practice of reciprocity. If a Serbian citizen is able to own real estate in one's respective country, then that individual has an equal opportunity to do so in Serbia. In addition, those individuals unable to own land via reciprocity can circumvent this policy by incorporating themselves within Serbia, thus becoming a local legal entity and capable of owning property.

Unlike all other neighboring countries, where foreigners have restricted rights over the ownership of land, in Serbia foreign and local individuals, as well as legal entities are treated equally.

Price range

The following graph shows the average prices of real estate in major Serbian cities. Prices are euro/m2 (euro per square meter).

Prices in Belgrade are the highest in the country, with prices in the larger regional cities reaching 60% and those in the Montenegrin capital Podgorica reaching only 70% of the value of comparable properties in Belgrade. Prices for apartments in the new, larger apartment buildings on the main New Belgrade boulevards range from €1200 to €1700/m2, depending on the size of the apartment and the construction stage in which the transaction takes place. New apartments in downtown districts (city center and Vracar) and Savski Venac (Dedinje and Senjak) vary more, ranging from €1100 to €1800/m2, depending on the exact location of the complex, the quality of the interior finishes and other amenities.

What To Expect With Regard To Standards?

Those interested in exclusive properties are often impressed by the quality of construction and interior standards in Belgrade. If money is not an issue, even the most discriminating of tastes can be accommodated. Apartments come in a variety of sizes; however, it is more difficult to rent small size high quality apartments. Highest demand for sale is also noticed with apartments under 60 m2. Those experiencing the greatest difficulty are looking to rent or buy a small family house of 150 to 300 m2, since most homes constructed are much larger. Apartments come in a variety of sizes; however, it is more difficult to rent small size high quality apartments. Highest demand for sale is also noticed with apartments under 60 m2.

Serbia Apartments |