+44 20 7493 4933 - King Sturge

With new supply entering the market it is expected
that prime rents will slightly decline.
The sale prices for modern warehouse spaces range
from €1,000/m 2 to €1,100/m 2 , while the sale prices
of old warehouse space are lower and range from
€500/m 2 to €750/m 2 .
Land values for logistics use current stand at up
to €60/m² in prime locations, falling to €40/m² in
secondary locations. Construction costs have been
relatively stable over the last four years and remain
around €400/m² (excluding planning permission
costs and taxes).
Land values and warehouse sell prices - Zagreb
Property type Range 2006 €/m²
Land values Warehouse sell
price
Prime 40 - 60 1,000 - 1,100
Secondary 15 - 40 500 - 750
Source: King Sturge, January 2007
Rents for distribution warehouses
€/m 2 /month
7
6
5
4
3
2
1
-0
Serbia
Source: King Sturge
Croatia
Old warehouse in Žitnjak
Czech
Republic
Hungary
Prime rents Secondary rents
Romania
Slovakia
Poland
www.kingsturge.com 15
Retail market overview
The political changes in Croatia over the last decade
have strongly infl uenced the country’s retail sector.
The market has been going through a process of
privatisation that, although not completed, has
successfully opened the sector to both domestic
and international private retail operations. However,
there are still some remnants of the past, including
state ownership of a number of smaller stores and
complex legal requirements for entering the market.
The Croatian retail market is in the process of
transformation. Historically, the whole country has
been dominated by small, domestic retailers in
high-street-style shops. However, the situation is
changing rapidly as international chains have already
started to set up large retail centres in the capital
and in some other major cities. Partly triggered by
these new retail channels, Croatian consumers
are changing their shopping habits; in turn, this is
driving the larger domestic chains to transform their
businesses by adapting their shops to international
standards of size and design.
Croatia’s stability, economic development and
progress towards European Union accession are
attracting the main international retail chains to the
market. Although the total population of Croatia is
relatively low, it has a large urban population with
approximately 60% of the total in the major cities.
Croatia is a comparatively low-risk market and mainly
retailers are using Zagreb as an entry point for the
rest of the country and, in some cases, for the South
East European markets.
Improvements in infrastructure across Croatia have
also facilitated the entry of new chains into other
cities outside the capital, such as Rijeka, Split or
Osijek. Food retailers are particularly aggressive in
expanding to cities such as Split and Zadar on the
Adriatic coast and Osijek and Sisak to the west of
Zagreb.
Metro food retailer in Zagreb-west