commercial real estate investments in the Czech Republic

Commercial investments in small Czech towns are growing

Prague is the capital and financial core of the Czech Republic. However, the rest of the country is also becoming very attractive for commercial real estate investments.

The numbers speak by themselves. When comparing the rise in demand for this type of goods in Prague and the rest of the country, both numbers are quite similar. In both cases, the supply is unable to completely follow this trend, which means that there is an increase in prices too.

According to the information given by the Czech broker Knight Frank, through its CEO Zdenka Klapalova, the most demanded type of commercial real estate are office and business spaces worth around 50 million CZK, located everywhere in the country.

This company takes part in a lot of these transactions, and during 2016 they traded commercial real estate transactions for approximately 1.3 billion CZK in all the Czech Republic except Prague. Most of the sellers, in this case, were banks and manufacturing companies. Of course, this is only one broker among many that exist in the country.

One reason why this type of investment has become increasingly popular is that it is seen as a way for safely storage wealth for a long period of time. Another one being the increase in demand for leasing this type of goods, which can also be a reliable and stable source of income.

The average buyers of commercial real estate are private investors, real estate funds and transport companies. Most of them still come from abroad. However, considering the growth in the economy of the country, more local entities are becoming engaged in this type of investments as well.

One of the richest people in the Czech Republic, Radovan Vitek, sold during these last years a group of business spaces valued in 650 million CZK through his company called CPI Property Group. They were located in places such as Ostrava, Plzen, Brno, Pardubice and Tabor. Most of these properties were purchased by a company called Middle Europe Investments.

In conclusion, it is possible to say that entities willing to engage in commercial real estate investments in the Czech Republic should look for opportunities not only in Prague but in the rest of the country as well. Cities of all sizes are providing opportunities for making such transactions, which can be used as a way to store wealth, or as a reliable source of income by leasing it.

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