The volume of apartment transactions has also been growing in recent years, especially in Zagreb, which, according to the eNekretnina transaction database, accounts for 40 percent of all apartment transactions in Croatia in the first six months.
"Due to the earthquakes, which destroyed a large part of the old buildings in the center of Zagreb, the demand has increased, which mainly comes from the local population in search of permanent accommodation, primarily for new buildings built to the highest safety standards," the review said. that at the time of the lockdown there was an increased demand for houses. It is estimated that the VMD Kvart Heinzelova - Darwinova project will contribute to the offer of new construction in Zagreb, with the first phase of construction planned for the end of 2021, and the second for 2022 and 2023. Sales prices for more than 400 apartments in the residential complex range between 2,600 and 3,000 euros per square meter.
As the pandemic has accelerated trends such as working from home, some companies, especially in the IT sector, are considering some version of the hybrid business model. Flexible office spaces and coworking are more in demand. When it comes to rental prices, the average net effective rental price of a Class A office in Zagreb remained at 12.5 euros per square meter. The vacancy rate is about 5 percent. The trend of online shopping and e-commerce has also increased, but it is still expected that the leading shopping centers in good locations will continue to perform well. Grocery stores (Lidl, Kaufland, Plodine, Tommy) continued to expand, led by the Italian discounter Eurospin, the last retail chain to enter the Croatian market, Jutarnji list writes.
Despite the favorable geographical position, proximity and transport connections with Central Europe, according to Colliers, the industrial and logistics market remains the most underdeveloped real estate market in Croatia. Demand has been growing steadily in recent years, especially for modern logistics spaces. With increased interest and activity from developers, an increase in supply is expected in the coming years, especially with new build-to-suit (BTS) projects. The main drivers of demand are retail, distributors, 3PL operators and e-commerce.
"Local developers dominate a market characterized by a limited supply of modern space that cannot meet international standards. However, the pandemic has further accelerated strong demand and brought developers the opportunity to provide new, modern and significant real estate for respectable tenants," the Colliers review said. Log-Expert, the developer of the Class A logistics park in the Meridian 16 business zone near Velika Gorica and the Zagreb ring, stand out.
Compared to other Mediterranean countries and neighboring Montenegro, according to Colliers, Croatia has an underdeveloped market, the so-called second home real estate. Despite the great interest of foreign investors and developers, such as Austrians, Slovenes, Slovaks, Czechs and Russians, there is very little large greenfield investment in this sector. Key obstacles to new projects are administrative problems (slow and complicated bureaucracy), inefficient judiciary, fiscal policy, seasonality of destinations, as well as location accessibility. But they single out the Lukoran project, which includes a luxury resort on the island of Ugljan, and should start in 2022 and will consist of 126 residential units, including villas, urban houses, apartments, a beach club and a marina.