MARKET SNAPSHOT: ASSET CLASS OPPORTUNITIES
Housing loans increased from TRY 3.5 billion in 2004 to TRY 68 billion as of September 2011. Te share of housing loans as a proportion of Turkey’s GDP is estimated to hit 15 percent in 2015 Retail development is on the up with the number of malls growing from 44 to 284 between 2000 and 2011 with a number of completed projects across the country, and not just sited in major cities such as Istanbul, Ankara and Izmir Demand for office space, especially in Istanbul’s most desirable districts, is growing, with limited supply lowering vacancy rates and effecting rent increases Logistics is the leading industrial sub-sector and is being driven by increasing industrial production and growing export-import and retail markets, with increased outsourcing to third-party logistics companies
Courtesy of Invest In Turkey,
www.invest.gov.tr; Business Monitor International Turkey Real Estate Report Q1 2012
locations like the Prince’s Islands, plus newly-developed upscale city centre projects,” he says. “Resort locations on the southwestern coastline haven’t seen much demand before, however we are now starting to see acquisitions of upscale villa developments or hotels in places like Bodrum and Antalya. Tese buyers typically purchase big-ticket property under local legal entities where 100 per cent shares can be own by foreign individuals; so the reciprocity law had little impact on these sectors and submarkets,” he adds. Cin reports that institutional investors from Qatar, the UAE and Bahrain as leading the investment wave, with individual buyers from Saudi Arabia, Yemen, Iraq, Egypt, Lebanon and Syria also eyeing up deals. “Lately, there has been strong demand from foreign investors in
refurbished residential or commercial buildings in Istanbul’s city centre, and end user demand for such developments is high. “We are also seeing interest in newly-developed residential villas
managed by reputable five-star or luxury boutique hotel companies in resort areas like Bodrum and Çeşme. Tese investments are favoured by high income Middle Eastern buyers as they can use the hotel management to maintain the property and generate income when not in use by the owner.” With high-end brands including Mandarin Oriental, Four Seasons and
Viceroy identifying opportunities in the popular coastal resort of Bodrum, this also augurs well for the future. However, Cin has a word of caution for prospective investors, as he
explains: “I believe that zoning rights and procedures must be more transparent, and with less bureaucracy at municipality level, in order to get more foreign investors to invest into real estate development. “Tis lack of transparency is currently driving foreign investors to partner
up with local companies and developers, which makes it less profitable for them to engage with new projects and thus keep foreign direct investment at lower levels than other industry sectors” l
APRIL 2012 I CITYSCAPE I 13
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