Investment volumes into the CEE's six largest economies slowed by 21% in the first quarter of 2019, with retail deals in freefall compared to the same period a year before, according to new research from Colliers International.
Interest in retail properties slowed to a trickle in the first three months of the year, with just €161 mln of deals recorded, compared to €2.03 bn a year before.
Another key issue were the significantly lower investments in Poland, which fell 60% year-on-year.
Despite the reduced deal flow - reaching just €2.3 bn of capital - East Asian and domestic funds remained particularly active.
'The bright spots are that Czech deal flow is back up to the quarterly run rate seen in 2016 and 2017, the CEE-6 office volumes of €1.25 bn, and a near-record quarter in the hotel sector, where €459 mln of purchases were made,' said Mark Robinson, CEE Research specialist, Colliers International.
'West European funds were net buyers in Q1 2019, while US and UK funds remained net sellers. East Asians were still buyers and domestic money remains active,' Robinson noted.
The report suggested that 'two speed' GDP dynamics are emerging across much of the global economy, with manufacturing slowing, while services continuing to grow. This is echoed to some extent in CEE, with slowing momentum in Q1 industrial production evident in the Czech Republic and Romania.
However, manufacturing growth remains healthier elsewhere in the region. Retail sales growth in Q1 was also robust across most of the territories surveyed - supported by positive wage dynamics - except Slovakia and Bulgaria.
