The real estate market in Slovakia is heading towards the final stages of the business cycle. Compared to the situation of ten years ago, it seems that the big players in this market today do not have much ambition to expand their activities. A bold statement? At the CEDES conference last week, co-organized by Atrios, real estate, development, investors, consultants and service providers in the construction sector agreed on several similar conclusions. What will the real estate market bring in the coming years?
What potential does the Slovak economy and investment in the real estate market have?
The Slovak market and development are naturally most influenced by the situation in Germany, where the local economy is in recession. According to Maria Valachyová (Slovenská sporiteľňa), however, there is no need to worry very much. The biggest boom seems to be the end, but for some time we can count on the growth of our economy as well. Alexander Šrank (PwC) also agreed with this view. In his view, the new era brings another strong year in terms of investment volume, especially in the retail sector. In the end, we can say that Slovak liquidity is mainly hampered by the size of the market and the extraordinary influence of local players.
Office development: What innovations does this sector bring?
An interesting discussion about innovations in office development was moderated by Tomáš Liška (Pressburg development). A new segment of high-quality buildings is growing in Bratislava – the new downtown in the Chalúpkova zone is to bring new office space meeting the latest trends. Vladimir Bolek (IAD Investment) says that in addition to the site itself, the quality of the building and its ground plan, the key aspect is the increasingly declining sustainability. The maturity of environmentally-friendly technologies is particularly important when looking into the future – in terms of the benefits that such a building can bring, say, in 10 years.
The office development sector is currently closely linked to HR. Michaela Ochmanová (Colliers International) approached the tenant who is looking at the quality of working life of her employees when choosing the space. The key factor for the tenant of an office building is therefore the added value that space can bring to them. In this context, co-working is at the forefront, which is at the center of attention not only of start-up companies but also of large corporations. Why? According to Ján Búza (HubHub), they promise today the strongest benefit for tenants – flexibility. Co-working will make up a significant percentage of office buildings in the future because of its high flexibility.
Michal Hoško (Corwin) also confirmed this trend for the developer, but according to him it is also important that the developer focuses on the comfort and well-being of people when preparing the project. Therefore, in their projects, they automatically count on the use of modern technologies to give the building the best possible sustainability certificate. However, there are also details such as high-quality facilities for cyclists and sportsmen. A bonus is the creation of areas for social activities, for example by moving like building a living square in the Blumental project.
Howare the shopping centers changing?
The biggest challenge facing today’s business centers is saturation. Experts say that in cities like Bratislava or Zilina we can talk about presaturation. This is best confirmed by Katarína Paule (Cushman Wakefield), who moderated this discussion. So what is the solution?
In addition to the appropriate choice of services and individual brands, it is increasingly important to consider how the environment affects the customer. Adrián Bódis (Immofinanz) in connection with the ongoing reconstruction of Polus says that the key is to understand the so-called customer journey, because this is the only way to approach the needs of a particular customer. The biggest trend is predicted by Igor Valent (HB Reavis), according to which the character of shopping centers must focus on uniqueness. This is one of the reasons why the Nivy shopping center project is being prepared with many innovations from the farmer’s marketplace, a foodcourt that will bring freshly cooked food and a customer experience.
Eva Zekucia (Chefgroup) approached her view of modern foodcourts, which are a priority of ongoing and planned reconstructions of existing shopping centers. These should create a pleasant space for rest, bring quality food (surveys have shown that a Slovak customer likes traditional dishes the most) and especially be in the eyes of the foodcourt works outside lunchtime.
This was also confirmed by Vladimír Béreš (Avion Shopping Park), who has completed such a modern reconstruction. According to him, it is crucial to correctly estimate the size and capacity of the foodcourt. Anyway, the participants agreed that shopping centers are changing because of changing shopping habit and in the future they will become a place where people will spend their free time having fun and looking for quality food.
The first half of the CEDES conference brought many interesting opinions. Extensive reconstructions of shopping centers are nothing more than a response to the changing needs of our customers – all of us who are in these premises. In order to improve the shopping experience, many developers try to come up with nothing unique. The new building of the Nivy station is a proof of this. Taking into account the point that connects this sector with the currently fastest developing development – office buildings also try to attract tenants’ uniqueness. This is currently the highest level of sustainability.
However, at CEDES 2019 there were other topics that deserve enough attention. The evolving logistics, the new era of residential development and above all the municipality’s view of the situation with spatial planning will be given space in the second article.