Central Eastern Europe: Events and the trends on the market

The investment activities in the Central Eastern Europe have experienced a sharp rise over the last three years - a tendency that lately applies for the South Eastern region, too.

Immopro24 spoke with Tomislav Perović, Managing Director of Colliers International in Croatia, regarding current events and the trends on the market.


1. Immopro24: Please describe briefly the emphasis of the work of Colliers International within the South-Eastern-European market.

Tomislav Perović: Colliers International has been present in the Southeast Europe (SEE) market since the beginning of this century. The company opened its first office in Bulgaria in 2000 and spread across the remaining portion of SEE within the next few years, and now covers all of the SEE markets with a comprehensive range of real estate services.
Nowadays, Colliers International is recognized as a clear market leader in retail brokerage services, currently working on over 600,000 m² of retail commercial area with a lot more in the pipeline in the next few years. The strong position in the market was confirmed with the Colliers International being awarded Consultant/Agent of the year for two consecutive years, in 2005 and 2006.
Additionally, Colliers is engaged in office commercial space brokerage, full investment sales services, land brokerage, development consultancy, valuation services as well as property management services. We are working closely on second home markets as well as the hospitality industry, following the trends set by the interest of foreign investors currently present or announced on the market.
Current investors’ hot spots in the region are in Bulgaria, Serbia, Croatia and Montenegro, with a different focus in each, in relation to the development of the related markets. Furthermore, Albania and Macedonia are opening up towards the real estate market’s investors and the next wave of interest is expected to be in those markets as well.

2. Immopro24: In conjunction with the expected accession to the European Union rises also the confidence and interest of foreign investors, especially in the Croatian market. How did you experience the developments of the last two years?

Tomislav Perović: Colliers International was an active participant in these events. What we have witnessed is that in the last two years the majority of the developers were assessing the situation in the market and have been working on the preparation of future activities. Only in last 6 months, pending the announcement of the accession, overall market activities have intensified with the rising demand observed on a daily basis from all of the foreign investors, whether institutional or private. The overall retail market, the residential market in Zagreb and other larger cities as well as the opportunities on the coastline of Croatia, both second home and leisure industry products, are in the focus of the Investors.
Colliers International found it easy to integrate its overall activities in the market as the company has already developed knowledge and experience on all market segments, with the senior management being personally involved in the development of the market. Current positive signals coming from the market are expected to further increase demand while on the short run a number of projects in the market are, however, going to remain limited.

3. Immopro24: Which concrete political and economic risks to you descry? What future trend do you consider realistic?

Tomislav Perović: There are still plenty of possibilities in the market. Many of the market segments had not been covered professionally; many of the regions are still underdeveloped and completely run by domestic development of low quality. This situation is derived from many factors that investors associated with the Croatian market, some of which resulted in the exaggeration of local developers in order to give them additional time without foreign competition. Clear threats are a lack of transparency in legal documentation, planning and zoning processes as well as a lack of general information. Most of the risks can be recognized and dealt with in a professional manner with existing professionals on the market, whether they are legal, real estate or construction consultants.
For that particular reason Colliers International decided to provide a full service to its clients, realising that we should go beyond our usual practices in order to cover all of the demands of our clients. We are also working in a strong network with other professional practices to further ensure our customers are taken care of.


4. Immopro24: With respect to the nearer future – in which market segment of commercial real estate should foreign potential stake- or shareholder such as Germans invest into?

Tomislav Perović: Referring to the sectors of industry, retail and residential (both urban and second homes), they are expected to generate in the best results. An early start in certain locations and uncovered developments, like in the field of industrial real estate, is also expected to be a good place to start.


5. Immopro24: Which predominant customer profile have you been able to discern overtime?

Tomislav Perović: Our client base is already a large one; in terms of country of origin, Colliers International is currently serving a number of Israeli developers and investors as well as British private and institutional investors and various established CEE developers and investors. Larger private investors coming from Italy, Benelux, France and Scandinavia as well as developers from Germany and Austria, with their increased interest in real estate development, especially coastal development, are becoming more developed clients with an increase in their activities on the market. As for type of real estate, most of our clients historically were retail based; nowadays the focus is being spread across all asset classes.
We are now spreading our activities to cover all those needs. We have recently opened an office in Dubrovnik and are currently working on opening additional offices on the coastline of Croatia, Dalmatia and Istria, in order to provide a full service for all our clients.

6. Immopro24: How do you judge the role of a European online portal for commercial real estate such as Immopro24 with respect to the increasingly affiliating country markets?

Tomislav Perović: Colliers International found the idea very positive, it is a great modern network idea. We are looking forward to see the development of such a platform as we hope to share in the excitement of the successful operation of such a portal.



About Colliers International

At Colliers International, our mission is to provide our clients with the best possible real estate solutions. As a global affiliation of independently-owned real estate services firms with 10,092 employees in 267 offices in 57 countries, we are able to provide expert local real estate advice wherever our clients need us. Colliers was among the first commercial real estate organizations to recognize the importance of local knowledge on a global scale. As early as 1986, we joined together commercial firms in Asia, Canada, the United States, Europe, the Middle East and Africa to provide consistent, superior service in multiple locations. This pioneering tradition of global breadth and local depth continues today and sums up Colliers’ unique approach to the business of commercial real estate. By having the best firms around the world gathered under the umbrella of a single affiliation, we are able to provide clients with superior service through our local depth of knowledge and expertise.

Tomislav Perovic - Managing Director - Colliers International