The volume of investment into commercial real estate in Russia came to $4.6 bn (€3.6 bn) for the first half of 2013, according to Cushman & Wakefield.

The volume of investment into commercial real estate in Russia came to $4.6 bn (€3.6 bn) for the first half of 2013, according to Cushman & Wakefield.

The volume was 82% greater than in the second half of 2012 but 5% lower than the first half of 2012.

Moscow is still the core market for Russian property investments, absorbing 80-85% of total capital. The decentralisation trend away from Moscow towards the regions which slowed during the crisis years is beginning to revive.

After peaking at 25% in pre-crisis 2007, the percentage of regional investment is now growing again and currently stands at 15-20%. 'Demand for commercial real estate is higher than the offered supply especially in retail, warehouse, and hospitality sectors and we see a transfer of investor interest towards the regions,' said Alexander Zinkovski, senior analyst of Cushman & Wakefield´s research department.

In 2012, strong demand for regional investment reappeared, but the scarcity of quality supply was still a holdup factor with investors interested in economically developed cities with a population of over a million in the European part of Russia. With the expected delivery of 1.6-2.8 million m2 of shopping centres across Russia within the next two years, the investment pattern will change, according to C&W.

Retail has been growing in popularity in Russia since end-2011. In the first half of 2013, retail was the most attractive real estate sector for investors and accounted for half of all investments ($2 bn). In comparison, annual retail investment volumes came to $2 bn in 2011 and $2.6 bn in 2012. 'If all planned deals are concluded, then 2013 will become a record year for volumes in retail real estate,' Zinkovski said.

According to Cushman & Wakefield forecasts, by end-2013 the volume of investment deals will reach $8 bn.