The total deal volume for the CEE region reached €10.4 bn in 2020, down 24% on figures for 2019, according to Colliers International.
Poland and the Czech Republic secured 51% and 26% of CEE deal total respectively, representing declines on the previous year. Hungary also registered a year-on-year decline in deal volume, while Romania, Slovakia and Bulgaria all saw increases.
By way of comparison, total EMEA volumes are estimated to be down by 27% year on year. However, Colliers’ global capital markets' 2021 investor outlook report predicts a strong rebound across the board in 2021.
Investor appetite is likely to remain strong for 2021 for the CEE region, but will continue to be challenged by available product and the varying impact of Covid-19 on certain sectors, the research firm said.
Kevin Turpin, regional director of CEE research said: 'Investment volumes in Poland accounted for 51% of the overall CEE-6 total. The Czech Republic followed with a 26% share thanks to a large residential portfolio sale.
'Many markets face a lack of available product as owners of the most sought-after assets are either long term holders or, are waiting for markets to settle, rather than selling at a discount.'
Despite a decrease year-on-year, the office sector maintains its top spot in terms of transactional activity, although industrial volumes were up significantly as investors diversify into this seemingly Covid–proof sector and away from the more challenged retail and hospitality sectors.
PRS is another sector to watch and is of high interest, but product remains limited across much of the region, the Colliers report added.
Investor origin
The most notable deal was the acquisition of the Residomo residential portfolio by Heimstaden of Sweden. German, Israeli and Austrian capital also placed sizeable volumes of capital throughout the year. CEE domestic investors have again been very active during 2020, particularly Hungarian and Czech capital.
Asian capital, specifically from Singapore, maintains its interest in the region. GLP acquired the Goodman industrial platform and GIC expanded its industrial portfolio.
'In terms of pricing, prime industrial & logistics yields have remained stable, with some compression in select markets. We have moved prime office yields out on average by 25 bps and prime shopping centres by 50 bps.
'Although there has been a lack of transactional evidence to support further movement in some sectors, our view remains that while some shifts are inevitable, core, well performing assets should hold up well, with more pressure on secondary product,' Turpin concluded.
