AVICA takes part in the Urban Talks business meeting


Yield of high-quality commercial real estate facilities at the Moscow real estate market is around 11-12%, said Natalia Tishendorf, CEO, AVICA, in her presentation at the Urban Talks.

The subject of the Urban Talks roundtable discussion was “Investment climate in construction. Challenges and new solutions”. The participants discussed the tools that could be applied to improve the investment climate, pointing at the lowering of administrative barriers. Meanwhile, the experts concurred that in the current market context, the impediments to investment include restricted access and expensive project financing, volatility of the Ruble, difficulties with forecasting commercial real estate projects yield and decreasing demand for office and commercial real estate.

According to Natalia Tishendorf, at the current moment, investors’ expectations regarding yield of high-quality shopping and business centers in Moscow is around 11-12% in Dollar equivalent. Compared to yield for similar assets at the European markets (2-3%), investments into Russian real estate are attractive for Russian and international investors. Most probably, in 2016, investors will prioritize the purchase of the so-called “trophy” assets located within the Garden Ring area, that have a super-reliable pool of lessees with long leases and minimum vacancy.

The expert emphasized that the disjuncture in the perception of value of assets between investors and owners persists at the market. Over the last year and a half, the net operating profit of many shopping and business centers went down by some 30-40% in Dollar equivalent, and many commercial real estate owners are not ready to sell the facilities at current prices, delaying the transactions until the market recovers.

Sergey Levkin, Head of the Town-Planning Policy Department of the city of Moscow, Natalia Tishendorf, CEO, AVICA, Martin Schaffer, Managing Director, PPF Real Estate Russia, Leonid Kazinets, Chairman of the Board of Directors, Barkly Corporation, Natalia Shemanovskaya, Head of the Construction and Development Client Department, Sberbank CIB, and other experts took part in the Urban Talks business event.