Annual Report 2019 Annual Report 2019 Content
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Real Estate markets Annual report 2019 Annual report 2019 Content Macroeconomic 3 Kyiv Office market 7 Kyiv Retail market 13 Primary Residential market in Kyiv and Kyiv region 20 Kyiv Logistics market 24 Kyiv Hospitality market 28 Annual report 2019 Macroeconomics (Property Type) GDP of Ukraine 2019 (State Statistic GDP Growth 2019 (IMF), % Committee), bln UAH Less than 3% 675 3974,6 3 3-6% 2014 2015 2016 2017 2018 2019 Real GDP Nominal GDP +3.2% GDP of Ukraine 2019 by PPP (IMF) GDP by PPP 2019 (IMF) 400 12,0 9,8 390 More than 1 000 9,1 10,0 380 8,1 370 6,8 8,0 500-1 000 360 5,8 6,0 350 4,2 300-500 340 4,0 330 100-300 2,0 320 370 340 353 369 390 374 310 0,0 Less than 100 2014 2015 2016 2017 2018 2019 GDP, bln int. USD National currency rate to international dollar GDP by purchasing power parity (PPP) — the total market value of all final goods and services produced in a country in a given year converted to international dollars using purchasing power parity rates. An international dollar has the same purchasing power over GDP as a U.S. dollar has in the United States. Annual report 2019 Macroeconomics (Property Type) Average salary in Ukraine 2019 (State Av. wage growth Ukraine vs Top EU countries Statistic Committee) (Eurostat, State Statistic Committee) 14000 600 Lithuania 491 USD 40% 12000 500 Ukraine 16% 10000 Romania 400 12% 8000 Bulgaria 12% H 300 A 6000 U Hungary 11% 200 4000 264 Czech Republic (Czechia) 9% 2 1 100 2000 Latvia 8% 0 0 Slovakia 8% Estonia 7% Slovenia 7% Poland 6% +16% in UAH/+27% in USD Total households incomes across Europe, bln Average salaries in European cities 2019 EUR (Numbeo) Chișinău $320 More than 300 Skopje $423 100-200 Minsk $456 Belgrad $492 50-100 Varrna $578 20-50 Saint-Petersburg $660 10-20 Less than 10 Lodz $675 Kiev $717 Buharest $740 Sofia $772 Budapest $780 Annual report 2019 Macroeconomics (Property Type) Retail turnover in Ukraine/Kiev (State Retail turnover growth in Europe 2019 Statistic Committee), bln USD (Eurostat, State Statistic Committee), % 45,2 8,85 More 10% 5-10% 2-5% 0-2% Less than 0% 2017 2018 2019 2017 2018 2019 USD +32%/+36% UAH +10.5%/+15.1% Inflation in Ukraine 2019 (State Statistic Exchange rate USD/UAH (NBU) Committee),% 25,5 4,1 2014 2015 2016 2017 2018 2019 2014 2015 2016 2017 2018 2019 2020 5.7 points less 8.5% lower then in 2018 Annual report 2019 Macroeconomics Economic sentiment indicator in Ukraine Foreign direct investments in Ukraine (State (IES, State Statistic Committee) Statistic Committee), mln USD 113,4 3 070,0 2 355,0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2017 2018 2019 2013 2014 2015 2016 2017 2018 2019 10.8 points more than in 2018 +30% then in 2018 Construction Index Ukraine/Kiev (State Export&Import volumes (State Statistic Statistic Committee) Committee), bln USD 1 6 , , 6 3 2 2 1 1 4 0 8 6 7 0 60 50 2014 2015 2016 2017 2018 2019 Export Import 15/25 points more than in 2018 +6% each indicator Unemployment in Ukraine (State Statistic Industrial production Index (State Statistic Committee), % Committee) 8,4 91,7 2014 2015 2016 2017 2018 2019 2014 2015 2016 2017 2018 2019 0.7% lower than in 2018 3.6 points lower Annual report 2019 Macroeconomics IT Export volume and structure (Tech Ecosystem Guide 220 th. IT specialist To Ukraine), bln USD R&D, consultin 1 place in Europe in IT Export g, analytics etc 7 place in the world by quality 30% of freelancers 8,4 11 place in Top-50 World Develop Developers 4,5 5 ment 2,7 3 3,6 70% 24 place in A.T. Kearney Global Services Location Index 2018 2017 2016 2015 2025* 2019* Ukraine in Global Rankings 6 positions down The same Corruption +0.4 points position perceptions index 126 rank Human Freedom Development Score Index 52.3 points 0.75 points Global Innovation Index 47 rank Doing Business 71 rank +4 positions up +5 positions up Annual report 2019 Macroeconomics 2019 was marked by large switch of the political elites and enormous strengthen of the UAH/USD exchange rate, boosted by foreign investments to the hryvna-based bonds. In 2019 Ukrainian economy preserved the growth by 3.2%, driven mostly by success of agricultural sector, construction volumes and trade. The average salary has grown by 16% and come close to the level of the neighbourhood countries from European Union. The retail turnover has remained growing, inflation rate was lower than in 2018 by 5.7 points, consumer expectations fluctuated during the year in correspondence to political uncertainty at the year start and exchange rate, but remained positive in general. FDI gained 30% as a result of 2019. Along with that, there was a decrease of industrial production caused by unadverse conditions on foreign markets and decrease of export incomes given to hryvna strengthening. Ukraine also remained among the leaders in IT outsource sector, gaining new reaches in the IT services export volume. The country position in world ratings has risen in majority of ratings: for example, Doing Business rank gained 5 positions given to simplification of business start, construction permits and foreign trade, and strengthen of contracts provision. The short-term forecast for the economy at the end of 2019 was positive with the next slight decrease along with cycle downward trend for the world economy in general. The State Budget of Ukraine for 2020 was based on the forecast of the GDP growth at 3.7% in 2020 with the inflation assumed at 5.5% and the official exchange rate of UAH 27 per $1. But from the start of 2020 the country as the whole other world has been facing COVID-19 pandemic, which has a dramatic influence on the economic future. The countries practice monetary and fiscal support to moderate economic loses, nevertheless, the projected economic recession would continued for 2020-2021 for the most of scenarios. Ukraine government has worsen the 2020 forecast as well: GDP fall by 3.9%, unemployment rate growth to 9.4%, and real salary decrease by 0.3%. The average annual exchange rate is projected by 29.5 UAH per USD, inflation rate – by 8.7%. The forecasts are positive – the economy recovery is expected at the end of 2020. EBRD has the same projections for the Ukrainian economy. This scenario looks optimistic, but it is supported by the high probability of further cooperation with IMF as the Land and Bank law was finally adopted and the country bank system is evaluated stronger than it was in 2008 and 2013. The high impact also will have a world economy trends. It basic scenarios also suppose the crisis, with the start of recovery at the and of the 2020 for the optimistic scenario, at the start of 2021 for the basic one and at the end of 2021 for the pessimistic forecast. Based on the China experience, the bulk of epxerts opinions suggest the high probability of basic scenario, but, no doubt, that the it is very difficult to make a certain projections as pandemic pathway and scale is still low-predictable. Outlook Given in 2019 Update given in 2020 GDP +3.7% GDP -3.9% Inflation +5.5% Inflation +8.7% Exchange rate UAH/USD 27 Exchange rate UAH/USD 29.5 Kiev Office Market Annual report 2019 Annual report 2019 Kiev Office Market Market supply dynamics, th.sq.m. New supply 2500 350 Name Area, sq.m. GLA 300 Sigma BC 19 200 Wave Tower BC 15 000 2000 UNIT.City B10 10 400 1759,4 250 Palo Alto 5 000 Zitadelle 3 800 1500 Azor BC 5 400 200 Forum City Garden BC 1 phase 5 200 Rich Port BC 9 000 OB at 22-24 Hoholivska St. 9 000 150 1000 Structure of market stock 85,6 100 Right Bank – 15% Podil – 15% 500 50 Left Bank – 15% 0 0 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Center outside Total market stock at the start of the year CBD – 20% CBD – 35% New proposal Projects in the pipeline Name Class Address Area, sq.m. Year Unit City B st. Dorohozhytska 3,4,5,6,7 99 100 2020-2022 BC "Lukyanovsky" B st. Yuriy Illenko 2 \ 10 22 000 2020 BC Platform A st. Korolenkivska 3 19 500 2020-R BC Avenue 53 B Victory Avenue 53 18 500 2020 BC Eleven (3 phase) B st. Solomianska, 11 16 500 2020 Office Building B st. Harmatna, 9 12 400 2020-R BC Retroville B Pravdy Avenue 47 11 100 2020 Office Building B st. Degtyarivska \ str. Zoological 21 G. 11 000 2020 BC M8 A st. Moscow 8B 11 000 2020-R Office Building B st. Spaska, 26/14 9400 2020 BC Hilfort A st. Mikhailovskaya 12 8 600 2020 BC Forum Infinity B st. Saksaganskogo 53 \ 80 8 500 2020-R BC Forum City Garden (2 phase) B st. Amurska, 6 8 500 2020 Zoryaniy B st. Moscow 31 \ 33 7 800 2020-R BC Forum Park Tower B st. Park-Syretska, 7A 7 500 2020 BC K \ MOST A st. Zoological 5 500 2020 BC Arsenal K14 B st. Moscow 8 3 800 2020-R Magnett A st. V. Vasylkivska, 137/139 43 000 2021 Office Building A st.