Real Estate Market Monitoring - June 2012

The monitoring highlights the results of the residential and commercial real estate markets development in Moscow and the Moscow region in June 2012.

The supply volume in the elite primary market lost 2% and amounted to 1, 430 elite flats/apartments by the results of June 2012. The average price in the elite primary market settled at the level of $19, 050 per sq.m. in the segment of elite flats and at the level of $ 14, 550 per sq.m. in the segment of elite apartments by the end of June 2012. The price of flats in the secondary market was $23, 940 per sq.m. The dollar prices remained practically at the level of the previous month in all the segments, the change of average prices did not exceed 1%.

A high level of business activity was observed in the office real estate market in June: some lease transactions were concluded, the aggregate volume of which exceeded 20 thous. sq.m. In the first summer month of 2012 the construction of some projects was announced: City-planning-land commission of Moscow approved the parameters of construction of MFC and CSKA stadium. In its turn VTB took under control the construction of Iskra BC measuring 201 thous.sq.m. The investment climate at the beginning of summer period may be estimated as favourable: Finnish investment company Sponda Plc. acquired “Bakhrushinsky dom” office center at the price of $47 mln. Turkish building holding Reneissance Construction announced its intention to invest $1.1 bln. into the project of a business center in Moscow-City. 

A landmark event of June 2012 in the hotel market of Moscow was the opening of the first in the city hotel under Azimut brand. Since June Azimut Moscow Tulskaya Hotel for 144 rooms operates in the soft opening regime, the formal opening is scheduled for Q3 2012. Besides in June, despite traditional decline of business activity, a number of new hotel projects, both in Moscow and in regions, were announced.

An important event of June in the retail real estate market was the opening of a retail center Sombrero in Chertanovo. The total area of RC constituted 17, 000 sq.m., the rentable area – 6, 300 sq.m. “O’Key Express” supermarket and “Deti” store of children’s goods became the anchor tenants of the complex. Considerable increase of professional retail areas is recorded in June in St.-Petersburg. Another event of June was the introduction of a British chain of children’s and future mothers’ goods stores to the Russian market. The first store was opened in Moscow in Evropeysky REC, the second one – in Krasnodar in “SBS Megamall”.

The countryside real estate market continues to grow: the beginning of sales in four settlements and the implementation of five projects were announced for the previous month. The main products in the new supply delivered to the market since the beginning of the year are still land plots without building contracts and townhouses. The announced projects in June include “Nikolsky Bereg”, “Pushkino Land”, “Sosnovy Bor”, “American Dream”, “Dom khudozhnika & Vernisazh”, “President club”, etc. In general, new projects delivered to the market in June are presented in a rather affordable price range. Kaluzhskoe direction is still under the most active development.