Press Release brought to you by NAI Ukraine

NAI Ukraine: The economy of Ukraine in 2016 has demonstrated stabilization with a tendency for moderate growth

03/20/2017

Kyiv city, Ukraine – March 20, 2017: Following the overall results of 2016, the economy of Ukraine has demonstrated stabilization with a tendency for moderate growth. It is expected that GDP will show growth within 2-2.5%, the inflation and devaluation rates have slowed down, considering the growth in industrial, agricultural, and construction industries. Due to this fact, Ukraine has risen in many international rankings, including Doing Business and Human Development Index. At the same time, the consumer confidence of Ukrainians has improved, as well as the retail turnover, which has increased by 13.8%.

However, numerous economic problems still remain open: the rate of growing income of the population lags behind the inflation and devaluation rates, the investment attractiveness of the country remains low, the economy of the country is estimated by the international ratings as corrupt, being limited, in terms of economic freedom, and uncompetitive in the international arena.

“In terms of investment attractiveness, the country basically failed to do anything at all, – noted the founder and CEO of NAI Ukraine Vitalii Boyko. – Ukraine is still perceived as the economic outsider and as the country that is not attractive in terms of investments. Yet, the domestic retail and real estate markets are still developing due to the domestic potential of the country. The residential real estate market today replaces bank institutions that went bankrupt, allowing small investors to preserve their capitals”.

The following tendencies of economic development influence the real estate markets today:

– The gradual recovery of the consumer confidence and growth of the retail turnover speak of an interest from the customers for the retailers and of stirring up of commercial real estate markets. It should be noted that this industry, as a rule, recovers from the crisis faster than the rest. However, the limiting factor is still the low level of income of population and concentration of the interest on consumer goods and the minimal “extended set”: clothes, footwear, entertainment;

– Low investment attractiveness climate in the country and the economic growth rate, as well as the devaluation of the national currency, limit the development of the enterprises and emergence of the new businesses, which does not contribute to an active growth in demand for the office real estate sphere. The scantiness of credit, inflation, and the unfavourable market situation hinder the growth in development. However, the gradual improvement in economic performance in 2016 will significantly affect the market: in the nearest future, a gradual recovery in demand will allow increasing consumption of the supply and stabilizing of the rents levels and the vacancy;

– Low income level, exchange rate volatility, and inflation make acquiring of housing a difficult investment to accomplish for most Ukrainians. This affects the level of demand for the housing and consumer preferences – the most attractive remains the housing of a small area. It is considering that a complex investment situation in all sectors of the economy makes investing in the residential real estate more attractive, and this fact is supporting the market interest from the consumers that share high income levels.

– In conditions of the currency devaluation, and due to a rich cultural and recreational potential, Ukraine can become an attractive tourism destination for the foreigners at low prices. Additionally, the first stabilization signs of the economy give a perspective for the restoration of the business activity and growth of the business tourism. All of this has a positive impact on the hotel market. However, considering the significant drop in the ADR and occupancy rate of the hotels in 2013-2014, the full market recovery is still a medium or a long-term perspective.

– The growth of the trade turnover and a gradual recovery of the trade have a positive impact on the warehouse market. However, the companies of the FMCG sector that will be the first to feel the restoration of demand in action, practice development of the built-to-suit projects, therefore, this market area has a high probability of development continuation in a most active way. In response to the decrease of the exports and a low growth of the economy, the development of the market is unlikely to be able to demonstrate good dynamics. Nevertheless, similar to the other markets, a slight strengthening of demand and the rent rates is expected.

About NAI Ukraine

NAI Ukraine represents NAI Global in Ukraine since July 2016. In the first 7 months, the company has become a leader in commercial real estate consulting and leasing. NAI Ukraine is a consultant and leasing agent of the major Ukrainian commercial real estate projects – such as Lavina Mall, Ocean Mall, Blockbuster Mall and many others.  NAI Ukraine team has a vast experience: 700 consulting projects, over 100 properties put into operation, and over 3 million sq.m. leased. To learn more, visit http://naiukraine.com/en

About NAI Global

NAI Global is a leading global commercial real estate brokerage firm. NAI Global offices are leaders in their local markets and work in unison to provide clients with exceptional solutions to their commercial real estate needs. NAI Global has more than 375 offices strategically located throughout North America, Latin America, Europe, Africa and Asia Pacific, with over 6,700 local market professionals, managing in excess of 400 million square feet of property.  Annually, NAI Global completes in excess of $20 billion in commercial real estate transactions throughout the world. To learn more, visit www.naiglobal.com and www.naiglobalnewslink.com

Source

NAI Ukraine

Want more news about NAI Ukraine? Click here