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Market Research Report

Commercial Real Estate Market in Turkey - Growth, Trends, and Forecast (2020 - 2025)

Published by Mordor Intelligence LLP Product code 925433
Published Content info 120 Pages
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Commercial Real Estate Market in Turkey - Growth, Trends, and Forecast (2020 - 2025)
Published: February 1, 2020 Content info: 120 Pages
Description

Turkey is an attractive country because of its transportation facilities, tourism and entertainment opportunities, and convention tourism. Istanbul, where Europe and Asia meet, emerges as a haven for real estate investments which is a rising star full of real estate opportunities and stands out as a haven for high value-added and profitable real estate. High-interest rates and economic restraint have had an impact on the economy and one of the impacts is a decline in real estate prices, a decline in the Lira.

The office market in Turkey to be positively affected by investment demand drawing closer to investors' expectations in the short to mid-term. Leasing activities gaining thrust and tenant-friendly conditions expected to remain in mid-term. Grade A office supply is expected to increase with 1.7 million square meters of office supply under construction.

Investment activity in the retail real estate segment is going to gain momentum as there are many distressed assets coming to the market. The rental prices are expected to decline due to continued pressure on landlords in the country. A new online retail platform is entering the market which will increase online retail sales while demand for e-commerce will continue to drive the force of retail in the digitalized world. Recent massive growth in online shopping has boosted the need for e-commerce warehousing and storage facilities. Under-construction giant projects are also drawing attention to Istanbul as a financial center.

There is new shopping mall development and construction in almost every major city in Turkey with more than 450 shopping centers operational in Turkey and a total gross leasable area of 13 million square meters.

Key Market Trends

Increase in Supply of Class A Office Stock/Units in the Turkey Commercial Real Estate Market

In Q12019, 151.980 sqm new office space was introduced in Istanbul and the total office supply increased to 6.33 million sqm. In 2019 approximately, 503,362 sq. m of new office stock is being planned on the Asian and European side of the city and will be ready in the coming two years. It is expected to increase supply by 60% on the Asian side and 40% on the European side of Istanbul. The majority of supply units are concentrated in KozyatagI/Atasehir and CBD districts on the Asian and European sides respectively.

In the first half of 2019, average Class A rents in the Istanbul West region did not change in TL terms; the regions with the highest increase in the average rental rate were Maslak and with a Rate of 12%. The office rents in terms of Turkish Lira has been increasing. The average rent for Class A buildings in Istanbul overall came in at 106TL/m²/month in the first half of 2019. In comparison to the second half of 2018, rents in Turkish Lira increased by 6% and rents in USD increased by 2%.

Istanbul's third airport which is under construction in North of Istanbul's European side also includes projects such as hotels, office buildings, and retail areas. The project is expected to increase office investments. It will also initiate a rise in the business and retail segment.

Declining Vacancy Rates in Istanbul Prime Office Real Estate

The average vacancy rate for Class A offices in Istanbul decreased to 33.42% in the first half of 2019 compared to the second half of 2018. The region that saw the steepest fall in vacancy rates was KozyatagI/Atasehir while Istanbul West is the only region where the vacancy remains stable.

The average vacancy rate of Class A offices on the European side in Q3 2018 fell to 40.66% from 40.68 in Q2, 2018. In the same period, the average vacancy rate of offices on the Asian side fell to 30.66% in Q3, 2018 from 32.08% in Q2, 2018.

Competitive Landscape

The commercial real estate market in Turkey is fragmented and has a highly competitive environment in order to capture limited demand between the property owners. The market has wonderful opportunities for Turkish and foreign real estate developers and investors.

Turkish property developers have established their international offices for attracting prospective foreign investors and promoting their projects. Investors from Qatar, Russia, Iran, Saudi Arabia, Turkic Republics, U.A.E and Azerbaijan have shown their keen interest in Turkish projects.

Reasons to Purchase this report:

  • The market estimate (ME) sheet in Excel format
  • Report customization as per the client's requirements
  • 3 months of analyst support
Table of Contents
Product Code: 53231

Table of Contents

1 INTRODUCTION

  • 1.1 Study Assumptions
  • 1.2 Scope of the Study

2 RESEARCH METHODOLOGY

3 EXECUTIVE SUMMARY

4 MARKET INSIGHTS

  • 4.1 Current Economic Scenario and Consumer Sentiment
  • 4.2 Commercial Real Estate Buying Trends - Socioeconomic and Demogpaphic Insights
  • 4.3 Government Initatives, Regulatory Aspects for Commercial Real Estate Sector
  • 4.4 Insights on Existing and Upcoming Projects
  • 4.5 Insights on interest rate regime for general economy, and real estate lending
  • 4.6 Insights on rental yields in commercial real estate segment
  • 4.7 Insights on capital market penetration and REIT presence in commercial real estate
  • 4.8 Insights on public-private partnerships in commercial real estate
  • 4.9 Insights on real estate tech and startups active in real estate segment (broking, social media, facility management, property management)

5 MARKET DYNAMICS

  • 5.1 Drivers
  • 5.2 Restraints
  • 5.3 Opportunities
  • 5.4 Challenges

6 MARKET SEGMENTATION

  • 6.1 By Type
    • 6.1.1 Offices
    • 6.1.2 Retail
    • 6.1.3 Industrial
    • 6.1.4 Logistics
    • 6.1.5 Multi-Family
    • 6.1.6 Hospitality
  • 6.2 By Key Cities
    • 6.2.1 Istanbul
    • 6.2.2 Bursa
    • 6.2.3 Antalya

7 COMPETITIVE LANDSCAPE

  • 7.1 Market Concentration
  • 7.2 Company Profiles
    • 7.2.1 Agaoglu Group
    • 7.2.2 Artas Group
    • 7.2.3 Ege Yapi
    • 7.2.4 Calik holding
    • 7.2.5 Ronesans Holding
    • 7.2.6 PEGA
    • 7.2.7 CBRE
    • 7.2.8 JLL
    • 7.2.9 Cushman and Wakefield
    • 7.2.10 Contaxer
    • 7.2.11 Turkish Hotel Association (TUROB)

8 FUTURE OF THE MARKET AND ANALYST RECOMMENDATIONS

9 INVESTMENT ANALYSIS

  • 9.1 Direct Investments
  • 9.2 Indirect Investments

10 DISCLAIMER

11 ABOUT US

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