Foreign investors withdraw money from Russian real estate

For the first time in four years they sold more than they invested.
Foreign investors can sell commercial real estate in Russia for a total of $ 1.54 billion in 2017, while they will invest three times less - $ 502 million, according to a report by international consulting company Knight Frank.

The report says that dynamics, when foreign companies leave Russian assets more than they buy, was recorded for the first time in four years. So, last year they spent $ 466 million to buy offices, shopping centers and warehouses, and sold objects for only $ 42.2 million. Data for 2015 - $ 540 million and $ 126.5 million, and a year earlier - $ 1.35 billion and $ 627 million, respectively.

Director of the department of financial markets and investments Knight Frank Alan Baloev explains the trend by the fact that some foreign investors are implementing plans to exit from Russia, adopted a few years ago. The investors who own large portfolios in commercial real estate leave the country. Among these companies are the Austrian Immofinanz (shopping centers in Moscow with a total area of ​​278,500 sq. M.) And the Finnish EPI Russia I Ky (business centers and logopark in St. Petersburg 120,000 sq. M.). In addition, this year its only Russian asset - the office tower in IFC Metropolis, which is valued at $ 130 million - may be sold by the investment fund Heitman.

This trend does indeed exist, confirms the partner of Colliers International Stanislav Bibik. But, he said, it is due to only one major deal for sale by Fort Group. Previously reported that the Russian investor will pay for shopping centers of the Austrians 901 million euros, or more than $ 1 billion, and this is the largest portfolio transaction in the history of the Russian real estate market.

In fact, this year foreign investors were much more active than their Russian counterparts, Bibik notes. So, the Chinese Fosun International acquired the office complex Voentorg, and Raven Russia - logopark "North". Heitman's investment fund does go away, but it sells its only facility also to a foreign investor - American Hines and Czech PPF Real Estate, Bibik recalls.

Despite the departure of a number of investors, the Russian real estate market remains attractive, Knight Frank said in a report. So, the capitalization rate in Moscow by 2017 is 9.75-11.75%, depending on the segment of commercial real estate, while in large European cities it ranges from 3% to 5.5%.