The uncertainty brought by the coronavirus pandemic crisis will slow down investments in office space in the region, as concluded at the “Office SEE Regional Panel: Office Innovations”, held within the online REBEC 2020 summit.
A large number of companies are not rushing to go back to their office spaces and many will not return before 2021. As Susanne Lorencin, a partner at Cushman and Wakefield's London office, pointed out, numerous companies are thinking about where they could be located in the future:
– Research has shown that working from home was very effective, in as many as 75% of the cases. Productivity also remained high. Older generations pointed out that they wanted their working space, whereas younger ones are more flexible. In the future, more people will want to have a choice of where to work from.
Christoph Buchgraber of CA Immo said that Poland the Czech Republic stood out for their market liquidity, whereas Serbia and Croatia were growing stronger.
– Bulgaria was in the focus of foreign investors as well. However, most transactions have stopped now, which will also slow down investors – he said.
He added that all companies had been postponing their expansion plans, not wanting larger spaces.
– Many investors are no longer interested in entering new markets. That is the biggest problem – he pointed out.
The situation is very difficult, as investors are not sure what to do at the moment and can't tell what will happen in the future, according to Uros Grujic of CBRE.
He reminded that the region had been successful in the preceding five years and that COVID-19 had now pushed everyone three steps back.
– Still, our outlook remains positive, we are talking to investors, presenting our offer and products in order to interest them. Many processes are either paused or postponed. In the medium term and the long term, we believe that the situation will calm down and that there will not be a second wave, which should bring new investors to the market – he said.
He also believes that no one can tell what “the day after coronavirus” will look like.
– Our region requires creativity and flexibility. Once they come to the region, investors decide to start a business. I believe that the “post-covid” period will be similar to the one before coronavirus, not just when it comes to office space, but for the retail, residential buildings and the industry as well. People are exploring this region, looking to get office space and employ people – he added.
Horatiu Florescu of Knight Frank Hungary and Romania said that Southeast Europe was a market suitable for logistics, with a special focus on Serbia and Greece, especially when it comes to doing business with China.
– Residential building is also a great opportunity. Projects that will keep their value over time are important. Many clients are reducing their office spaces, but it's important to be positive. SEE is a “back office” destination, which is safer than the rest of the world – he said.
His advice to the clients is to be close to their tenants and to be flexible in the current situation.