Investors continue to View the Central and Eastern Europe Investment Market as an Attractive Destination

Most Central and Eastern Europe (CEE) economies have seen faster recoveries post COVID than Western EU economies, with Poland, Hungary, Romania and the Baltics being especially strong performers. However the global inflationary pressures, higher interest rates and supply chain issues, together with the possible recession in China, might impact CEE economies in the second half of 2022 due to their reliance on capital flows from other parts of the world, reveals a report by Colliers: CEE Investment Scene H1 2022.

"At circa. €5.3 billion for H1 2022, CEE volumes were up 8.5% YoY. Q1 recorded quite strong activity, only to slow again in Q2. There was a high volume of M&A activity via stock acquisitions or transfers, but these are not recorded in the volumes. Colliers estimates that year-end volumes will reach between €9.0 and 10.0 billion for 2022", explained Kevin Turpin, Regional Director of Capital Markets, CEE at Colliers.

CEE investment volume growth rates

Poland recorded a 56% share of H1 2022 volumes followed by Czech Republic and

Hungary with 16% and 12% respectively. Investors remain cautious considering the

geopolitical and economic sentiment, increased financing costs and anticipated shifts in pricing that are likely to play out during H2 2022.

CEE flows by sector

The office sector dominated the first half of 2022, with particularly strong activity recorded in Poland. Retail followed thanks to the complete sale or sale of shares in the Tesco and EPP portfolios. Logistics and residential continue to be in high demand but are being held back by the shortage supply of available product.

CEE flows by origin of buyer

CEE domestic capital...