Traditionally strong German and US funds remained well behind Korean competitors with a 7% and 10% share respectively, according to data provided by Cushman & Wakefield. “Korean acquisitions are subsidized by banks that hedge the currency risk of the euro against the Korean currency for the local investor. Moreover, there is still an interesting premium in real estate yields between Central and Western Europe, ”explained Tomáš Jandík from the Board of Directors of the Reico Česká spořitelna fund explaining the arrival of Koreans.
Koreans have almost matched the volume of real estate investments in the Czech Republic to domestic investors. “The importance of domestic investors has been growing in the long run, especially in terms of their potential to buy much more valuable real estate than before. In the first half of 2019, however, they were somewhat crowded out by Korean investors, and thus the share of Czechs in the volume of investments was 34 percent, ”said Michal Soták, head of the investment team for Central and Eastern Europe at Cushman & Wakefield. The newest Korean investments include the new Main Point Pankrác administration center in Prague 4. This year, South Korean investors in the Czech capital also purchased Waltrovka and Rustonka administrative complexes. In Bratislava, the new Korean owner has the Twin City Tower, which is rented by the American giant Amazon. The volume of investment in Czech business real estate in the first half was EUR 1.7 billion. Cushman & Wakefield consultants expect over three billion euros to invest in commercial real estate in the Czech Republic this year.