Slovakia's industrial market remains resilient
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Loading... - Anezka Bucic
- 09 Feb 2023
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Despite many negative factors, Q4 2022 showed that the economy in Slovakia should grow by 1.8% in 2022. Energy prices were stabilized, inflation peaked and we could see the increase in yields. The Slovak industrial sector remained once more the most resilient real estate segment and experienced very solid performance in 2022. In the same period, the lack of new supply resulted in lowered vacancies in offices. Overall retail park projects dominate both this year’s new supply and future retail development with limited space for larger retail schemes due to high saturation. Cushman & Wakefield published its market reports for Q4 2022.
A solid rebound of the local economy after the elimination of pandemic restrictions in 2022 was slowed down by an increase in energy prices connected with the conflict in Ukraine. Despite many negative factors, the last quarter showed that the economy is more resilient than predicted and the economy should grow by 1.8% in 2022. Energy prices have stabilized, and the sales of firms continue to rise although increasing costs are impacting many tenants, especially from the retail sector who have already struggled before. Furthermore, rising input costs and weakening global demand are behind pessimism in the corporate sector. Although inflation reached a record high level of 12.8% in 2022, its growth has already peaked in both the Eurozone and Slovakia, indicating a progressive decline in 2023. To further tame inflation, European Central Bank hiked interest rates to 2.5% in December. Additionally, the Slovak government's measures to cap energy prices for businesses and households should also contribute to reducing inflation and positively impacting purchasing power that would be otherwise impacted heavily by rising costs. Nonetheless, the labour market remains resilient and unemployment keeps fallen to 5.9% as of December. Read More…
