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Investment market<br />
Zagreb’s investment market is still very immature<br />
with very limited international-quality stock available.<br />
While international developers are relatively recent<br />
entrants to the market, local developers dominate<br />
the investment offer and will often only sell property<br />
in order to fi nance another scheme. However, with<br />
the increase in number of international developers<br />
entering the market, investment-quality stock is<br />
expected to expand rapidly and the offi ce and retail<br />
sectors are expected to see particular interest in the<br />
medium term.<br />
Croatia has fairly good prospects with regard<br />
to joining the EU, and the increasing wealth of<br />
domestic companies coupled with the falling yields<br />
in other eastern countries is likely to put this growing<br />
market in the range of targets for both domestic and<br />
international investors.<br />
Due to the small volume of transactions, it is very<br />
diffi cult to give accurate yields rates. Purchases<br />
during <strong>20</strong>06 include <strong>King</strong> Cross shopping centre in<br />
the second half of the year. Italian Coimpredil sold<br />
this 43,000m 2 development to DEGI, and the yield<br />
was around 7%. Also in the retail market, Aggmore<br />
purchased the Branimir Centre at the end of <strong>20</strong>06.<br />
Annual gross investment yields<br />
Prime locations Out of town<br />
Office 7.50% - 8.00% 7.75% - 8.25%<br />
Industrial 9.00% 10.00%<br />
Retail 7.00% - 7.50% 7.00% - 7.50%<br />
Source: <strong>King</strong> <strong>Sturge</strong>, January <strong>20</strong>07<br />
www.kingsturge.com 23<br />
<strong>King</strong> Cross shopping centre<br />
Branimar centre
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