Source: AG Nekretnine | Tuesday, 26.07.2011.| 13:06
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Arrival of Hilton and Marriott in Belgrade

This year's REBEC confirmed the validity of it’s orientation with its conceptual and development program. Analyzing the variety of speakers and topics that they have presented at 13 panels on the current situation of the real estate market in Serbia and the region, we can say that the conclusions spelled out some time ago are confirmed. After just a month of the end of REBEC 2011, the topics related to retail, hotel development, project management, sustainable construction and energy efficiency with the standard and expected interesting topics on housing construction, development of business activities related to the valuation of real estate, actualize the new information much faster and better than expected. Although it’s the summer period and the holiday season, it is obvious that the time has come for the ultimate implementation of certain activities and procedures. As a confirmation of this, the uncontested facts and information about new projects and ventures have emerged in the market.

The Association of Appraisers of Serbia is formed, and it will offer education and licensing procedures of local appraisers of all kind. This process will in its further development ultimately define the scope and content of local standards for the evaluation of assets and capital that will absolutely correspond with the international accepted standards.

One of the specialized companies that manage project with domestic and foreign denomination has decided to appear, under the framework of its activity, as a general contractor for a foreign investor, which is not such novelty elsewhere in the world. Also, another company has decided to establish in Belgrade it’s regional center, which will cover the geographical markets of the countries that are already in the European Union.

When it comes to the themes related to energy efficiency and sustainable construction, announcements and organization of specialized courses by authoritative associations are gaining in number, meaning that those attending such courses will be provided with a new knowledge, as well as some kind of certification of this knowledge.

In the retail market in Serbia, which is mainly brought in connection with "trade" and not production, implementation of a 30,000-square-meter project in Novi Sad started shortly before the 2011 REBEC. What was also announced is the beginning of the development of a project of the same purpose in Central Serbia and an investment partnership with foreign partners for a chosen location in Sabac.

But right now, certainly the most valuable information related to the development of hotel industry in Serbia, is a confirmed information that prestigious hotel chains Hilton and Marriott have chosen local partners and locations for first projects in Belgrade. On the stretch from Slavija to Kalemegdan these chains will now have one structure each. Hilton will be a complete greenfield investment, whereas Marriott will be implemented through the adaptation and reconstruction of an existing building. Bearing in mind that the project of reconstruction of Metropol and the reconstruction of the hotel Yugoslavia are expected to start soon and that the construction of a hotel in Block 11a in New Belgrade and hotels at Mostarska cloverleaf interchange has already started, while yet another hotel is expected to be built next to Arena in New Belgrade as of autumn, we can say that this year's two panels linked to the development of hotel industry at 2011 REBEC have confirmed the expectations that the hotel industry at this moment is the most recommended and most attractive type of property that can be developed unhindered in these times of crisis.

As far as the housing sector is concerned, its development will essentially continue to be conditioned by current economic powers and potentials that are dominant at this moment in the market and are related to potential buyers. A greater supply cannot attract more customers able to increase the sales by seriously decreasing the prices. Banks still conduct a restrictive policy of entry conditions that each entrepreneur must meet in order for an investment bank to support the development of larger housing projects.

The only advantage that is now present in the market of real estate development is the fact that the prices of construction are still on a downward trend when compared to the previous period, but this segment is not sufficient to lower the overall price per square meter. However, the current situation in the market is not "difficult" enough for serious investors to lower the projected margin sales price per square meter of residential construction, thus making it acceptable.

It just means that the time is coming when all participants in the development of this real estate segment may together define new business conditions. All the other segments of the market, in particular those related to industrial and retail real estate, will then further encourage investment.

We now have to wait until late summer, when the current rules will be re-analyzed, to see if everything mentioned above will be confirmed or negated. In October, at the upcoming 2011 EXPO REAL, the condition and potentials of the real estate development capacities in Serbia will again be the subject of our analyses.


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