Zdroj: ESTATE (19. 10. 2020)
According to the participants of the Real Estate Forum conference, in comparison with other European cities, Brno also offers investors an exceptional opportunity for development. An example is the new modern city district, which is being built on a large area south of Brno’s main railway station.
The so-called ‘South Centre’ or ‘Trnitá’ is a unique large area immediately adjacent to the historic centre of Brno, which has not developed for decades. “This is a potential that other cities can envy,” stressed Michal Sedláček, director of the Office of the Architect of the City of Brno, in a discussion at the conference. “It is not a brownfield, it is an open area that has a river, a railway station, etc. No other city in Europe has it,” he added.
According to the developers’ plans, several mixed modern city blocks are to be built here. The new district of Trnitá will offer not only office space, but also housing for ten to fifteen thousand people. The area should be alive even after the end of working hours. Residents should have all the necessary facilities here - services, shops, parks and a wide range of leisure activities.
However, the new development was designed and planned even before the coronavirus, which has now fundamentally changed the reality on the market, especially in commercial and office space. Developers must therefore take this into account in respect of this developing site.
Lukáš Netolický of the real estate consulting firm Cushman & Wakefield pointed out at the forum that there has already been a slowdown in demand and activity on the Brno office space market. In connection with the economic crisis, he predicted that there would be up to 100,000 square meters of unoccupied space in the South Moravian capital next year, and that the increased vacancy would persist until 2023 and 2024.
And developers must adapt to this new reality. Therefore, for example, CTP Invest will reduce the share of office space in the Vlněna project in favour of residential space.
According to Prokop Svoboda, the owner of the real estate agency Svoboda & Williams, tenants of office space will now also dictate where the market will go. “We will move towards greater flexibility and other office models,” he suggested in the discussion.
The international company HB Reavis, which plans to build a multi-purpose Nová Zvonařka project with more than 120,000 square meters of floor space in the Trnitá area, therefore also wants to offer customers shared workspaces (co-working) or serviced offices in addition to classic office premises. “This is a direction that covid may have speeded up, but which we would anyway reach over time, because we see it in more developed markets,” explained Štefan Stanko, HB Reavis Group’s Managing Director for the Czech Republic.
Not every company will be able to afford long-term lease of large office space in times of crisis, Stanko warned. The ideal solution is therefore for companies to have a central administrative base and, in the case of future expansion, to rent serviced offices in the vicinity, which the company can flexibly reduce again in times of recession.
The fact that the city is an ideal transport and logistics hub can also help trigger the office space market in Brno. At the same time, it benefits from its strategic location, when it is not far to Vienna or Bratislava. Brno has the second busiest airport in the Czech Republic, which is also connected to a logistics complex with an area of more than 110,000 square meters. As part of air cargo transport, more than five thousand tons of cargo are transported through Brno every year. This has already attracted significant aces of contemporary industry to the area near Brno Airport. The rental premises here are used, for example, by DHL, Coca-Cola or Zásilkovna, said Milan Kratina, co-founder and CEO of Accolade, which owns the multi-purpose complex and also operates Brno Airport.
This suitable connection between transport and logistics can thus be the driving force of the economy in the South Moravian region even during the corona crisis and can bring other companies here. “The airport is a gateway to the city and the region, there should be basic connectivity there, because then the region grows and business grows,” Kratina noted. This subsequently goes hand in hand with the development of the office space market, Netolický also confirmed. He gave Polish regional cities as an example, where after 2012, after the last economic crisis, the office space market grew dramatically thanks to the introduction of new airlines and the completion of the motorway network.
In the experience of the clients of HAVEL & PARTNERS, transport accessibility is one of the key factors in the placement of new projects, pointed out Ludvík Juřička, a partner of this largest Czech-Slovak law firm. Therefore, if a given locality does not have a good logistics connection, it significantly limits its development, which is also the case of the very interesting locality Nová Zbrojovka. However, the construction of the necessary infrastructure is often hampered by the biggest ailment of the Czech construction sector, which is long permitting procedures.
Therefore, what could help the further development of the real estate market in Brno and its surroundings in the future is the adoption of a new Building Act, which should significantly speed up the permitting of new construction, both residential and transport. Michal Sedláček and František Korbel, a partner of HAVEL & PARTNERS who participated in the creation of the new legislation, agreed on this. However, the new Building Act has yet to go through the legislative process, and it is therefore not clear when and in what form it will actually enter into force.
The idea to organize a Real Estate Forum focused on selected real estate market trends, current and specific projects and real estate topics in Brno and the South Moravian region came out from the largest Czech-Slovak law firm HAVEL & PARTNERS. Thanks to the exceptional composition of partners and speakers, the Forum became the most prestigious real estate event in the region, and took place for the second year on 13 October 2020. Due to the epidemiological situation, the forum was held online. However, the online format of this undoubtedly important event also brings its benefits, which is openness to a wider audience.
