GRIPeter Noack - Rental housing will rise in Czech Republic
Peter Noack, co-founder of Zeitgeist Asset Management, describes how rental housing is taking off in the Czech Republic.
April 17, 2019Real Estate
Peter Noack, co-founder and managing director of Zeitgeist Asset Management, a real estate developer and asset manager focused on Germany and CEE, describes how Zeitgeist plans to increase rental housing in the Czech Republic. He expects interest in rental housing in the Czech Republic to increase significantly in 2019, following the current trends in the neighbouring countries.
Zeitgeist is focused primarily on rental housing and student housing. Most of its projects are value-add and development projects, the bulk of which are located in Prague.
If you could give one piece of advice to investors wishing to break into CEE/SEE markets, what would it be?
Conduct detailed research and get to know the specific market. For investors looking for stable and less risky income, residential in Czech and Poland is the most interesting.
What is your favourite investment/development destination in the region and why?
One of the largest markets in CEE is Poland. We expect that this is a good occasion to introduce a residential-for-rent product into the Polish market. On the other hand, the Czech Republic has been the most reliable market. So if you are looking for a stable but small size investment, Czech is the best; for scale and opportunity, Poland is a good choice. For opportunistic investing, Hungary is definitely the one.
What have the most interesting/challenging project in which you have participated?
We focus primarily on rental housing and student housing. As we buy mostly existing buildings, with a plan of renovating or repositioning, each project is unique and has its own challenges and interesting points. The most challenging projects are where we are changing the zoning to achieve a residential use.
Which real estate debates/trends are on your and your team's agenda these days?
The Czech Republic is among the countries with the lowest share of rental housing in the EU. According to the statistical office of the EU (Eurostat), home ownership still dominates the market with a share of 78%, while rental housing only has 22%. Meanwhile, in the neighbouring countries (Germany, Austria) the share of rental housing is roughly double. The interest in rental housing in the Czech Republic, however, is expected to increase significantly this year, following the current trends in the neighbouring countries.
With the entry of private and institutional investors, the rental market is getting the clear rules and standards that people expect, which in turn makes rental housing an attractive and fully-fledged alternative to home ownership. Zeitgeist Asset Management supports this trend and is creating a portfolio of 500 rental flats in various localities and with a range of different standards in Prague. At the same time, it is bringing a new standard of student housing in terms of modern, reconstructed buildings to Prague. Following its success in the Czech Republic, it is preparing the same model in Poland, specifically in Warsaw.
How do you see the long-term future of CEE/SEE real estate?
For international investors, there are still opportunities and better returns possible. On the other hand, we have a stable economic environment that still has growth to come.
This interview is one of a series being published on the GRI Hub following a qualitative survey by GRI Club of real estate market leaders across the CEE/SEE region.
Peter Noack will be participating in CEE GRI 2019 on 14-15 May in Warsaw, where CEE real estate markets will be discussed in further detail.
Zeitgeist is focused primarily on rental housing and student housing. Most of its projects are value-add and development projects, the bulk of which are located in Prague.
If you could give one piece of advice to investors wishing to break into CEE/SEE markets, what would it be?
Conduct detailed research and get to know the specific market. For investors looking for stable and less risky income, residential in Czech and Poland is the most interesting.
What is your favourite investment/development destination in the region and why?
One of the largest markets in CEE is Poland. We expect that this is a good occasion to introduce a residential-for-rent product into the Polish market. On the other hand, the Czech Republic has been the most reliable market. So if you are looking for a stable but small size investment, Czech is the best; for scale and opportunity, Poland is a good choice. For opportunistic investing, Hungary is definitely the one.
What have the most interesting/challenging project in which you have participated?
We focus primarily on rental housing and student housing. As we buy mostly existing buildings, with a plan of renovating or repositioning, each project is unique and has its own challenges and interesting points. The most challenging projects are where we are changing the zoning to achieve a residential use.
Which real estate debates/trends are on your and your team's agenda these days?
The Czech Republic is among the countries with the lowest share of rental housing in the EU. According to the statistical office of the EU (Eurostat), home ownership still dominates the market with a share of 78%, while rental housing only has 22%. Meanwhile, in the neighbouring countries (Germany, Austria) the share of rental housing is roughly double. The interest in rental housing in the Czech Republic, however, is expected to increase significantly this year, following the current trends in the neighbouring countries.
With the entry of private and institutional investors, the rental market is getting the clear rules and standards that people expect, which in turn makes rental housing an attractive and fully-fledged alternative to home ownership. Zeitgeist Asset Management supports this trend and is creating a portfolio of 500 rental flats in various localities and with a range of different standards in Prague. At the same time, it is bringing a new standard of student housing in terms of modern, reconstructed buildings to Prague. Following its success in the Czech Republic, it is preparing the same model in Poland, specifically in Warsaw.
How do you see the long-term future of CEE/SEE real estate?
For international investors, there are still opportunities and better returns possible. On the other hand, we have a stable economic environment that still has growth to come.
This interview is one of a series being published on the GRI Hub following a qualitative survey by GRI Club of real estate market leaders across the CEE/SEE region.
Peter Noack will be participating in CEE GRI 2019 on 14-15 May in Warsaw, where CEE real estate markets will be discussed in further detail.
