Business Monitor International


Bosnia-Herzegovina Real Estate Report

Published 06 February 2014

  • 61 pages
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$1,295.00
Bosnia-Herzegovina Real Estate Report

BMI View: The uncertainty surrounding Bosnia & Herzegovina's political and economic backdrop continues to undermine growth in both the country's construction and real estate segments. While economic growth is expected to accelerate in 2014, rising to 2.1% y ear -o n -y ear , it will be some time until this filters through into the real estate market and translates into new demand.

With a focus on the three principal cities of Sarajevo, Trebinje and Zenica, the report covers the property fundamentals of the commercial real estate market rental market and examines the office, retail, industrial and construction segments throughout the country, in the context of the struggling domestic and regional economy.

Meanwhile, ongoing political concerns may hamper long-term growth within the real estate sector, with the country's integration into the EU still far from assured. The country's politicians are coming under increased criticism from the EU for not showing the will to make badly needed reforms and drive the country's integration into the region. While growing pressure at home and abroad may push the government to approve measures, we expect ethnic concerns to continue to trump EU ambitions among the political leadership

Meanwhile, the forthcoming general election continues to play on the mind of investors, given its potential to ignite current tensions between the various ethnic groups. However, over the long term, we expect the country's property market to benefit from growing interest in the Central and Eastern Europe region as a whole.

Recent Developments

  • In Q114, the government of the Federation of Bosnia-Herzegovina revealed a privatisation plans which includes listing a number of public-owned industrial assets for sale over the course of 2014. These include tobacco factories in Sarajevo and Mostar, and several metals plants, which the privatisation agency value at a combined BAM517mn.

  • There are plans for the redevelopment of the main bus station in the...

Table of Contents

BMI Industry View
7
SWOT
9
Political
11
Economic
12
Business Environment
13
Industry Forecast
14
Office
15
Table: Forecast Office Rents, 2013 And 2014 (US$ per m2/month)
15
Table: Forecast Office Net Yields, 2011-2018 (%)
16
Retail
16
Table: Forecast Retail Rents, 2013 And 2014 (US$ per m2/month)
16
Table: Forecast Retail Net Yields, 2011-2018 (%)
17
Industrial
17
Table: Forecast Industrial Rents, 2013 And 2014 (US$ per m2/month)
17
Table: Forecast Industrial Net Yields, 2011-2018 (%)
18
Construction And Infrastructure Forecast Scenario
18
Table: Bosnia's Construction And Infrastructure Industry Data
18
Table: Bosnia Construction And Infrastructure Industry Forecasts, 2017-2022
19
Macroeconomic Forecasts
23
Economic Analysis
23
Table: Bosnia-Herzegovina - Economic Activity
29
Industry Risk Reward Ratings
30
Central And Eastern Europe Risk/Reward Ratings
30
Table: Central And Eastern Europe Real Estate Risk/Reward Ratings
30
Bosnia & Herzegovina Risk/Reward Ratings
31
Risks
31
Rewards
31
Market Overview
32
Office
35
Table: Historical Rental Costs, 2011-2013 (US$ per m2/month)
36
Table: Net Yields, 2011-2013 (%)
37
Table: Terms Of Rental Contract/Leases, H213
37
Retail
37
Table: Historical Rental Costs, 2011-2013 (US$ per m2/month)
39
Table: Net Yields, 2011-2013 (%)
39
Table: Terms Of Rental Contract/Leases, H213
40
Industrial
41
Table: Historical Rental Costs, 2011-2013 (US$ per m2/month)
42
Table: Net Yields, 2011-2013 (%)
42
Table: Terms Of Rental Contract/Leases, H213
43
Competitive Landscape
44
Company Profile
46
BBI Real Estate
46
Delta Real Estate Group
48
GP Put dd Sarajevo
50
Strabag
51
Demographic Forecast
53
Demographic Outlook
53
Table: Bosnia & Herzegovina's Population By Age Group, 1990-2020 ('000)
54
Table: Bosnia & Herzegovina's Population By Age Group, 1990-2020 (% of total)
55
Table: Bosnia & Herzegovina's Key Population Ratios, 1990-2020
56
Table: Bosnia & Herzegovina's Rural And Urban Population, 1990-2020
56
Methodology
57
Industry Forecast Methodology
57
Sources
58
Risk/Reward Ratings Methodology
58
Table: Real Estate Risk/Reward Ratings Indicators
60
Table: Weighting Of Indicators
61

The Bosnia-Herzegovina Real Estate Report features Business Monitor International (BMI)'s market assessment and independent forecasts of major construction projects in the residential and commercial markets, plus rental prices and yields in major cities. The report critically analyses the prospects for real estate within the broader economic and financial context - both domestic and global - via our econometrically-modelled and clearly explained banking and economic forecasts and follows this through to evaluate the implications for REITs.

BMI's Bosnia-Herzegovina Real Estate Report provides industry professionals and strategists, sector analysts, business investors, trade associations and regulatory bodies with independent forecasts and competitive intelligence on the real estate industry in Bosnia-Herzegovina.

Key Benefits

  • Benchmark BMI's independent real estate industry forecasts for Bosnia-Herzegovina to test other views - a key input for successful budgeting and strategic business planning in the Bosnian real estate market.
  • Target business opportunities and risks in Bosnia-Herzegovina through our reviews of latest industry trends, regulatory changes and major deals, projects and investments.
  • Assess the activities, strategy and market position of your competitors, partners and clients via our Company Profiles (inc. SWOTs, KPIs and latest activity).

Coverage

BMI Industry View

Summary of BMI's key industry forecasts, views and trend analysis covering real estate and construction, regulatory changes, major investments and projects and significant national and multinational company developments.

Industry SWOT Analysis

Analysis of the major Strengths, Weaknesses, Opportunities and Threats within the real estate sector and within the broader political, financial, economic and business environment.

Market Overview

Overview of the real estate sector, including analysis of existing/planned real estate developments and emerging industry trends in the office, industrial and commercial sectors.

Market Analysis

Features detailed city-level data and analysis on rental prices, yields, contract terms and real estate availability with separate chapters covering the office, retail and industrial sub-sectors.

Industry Forecast Scenario

Historical data series (2010-2012) and forecasts to end-2018 for the domestic real estate industry and for the local and global finance industry. Indicators include:

Real Estate: Office, retail and industrial real estate yields for all major cities (%); short-term forecasts on minimum and maximum real estate rental prices by sub-sector (US$ per square metre, and local currency per square metre)

Construction: Industry value (US$bn); contribution to GDP (%); employment (`000); real growth (%)

Economy: Economic growth (%); nominal GDP (US$bn); unemployment (%); interest rates (%); exchange rate (against US$)

Business Environment Ratings

BMI's Real Estate Business Environment Ratings provide a country-comparative Risk-Reward Ratings index aimed at investors (real estate vendors, construction companies and financial investors) in the regional real estate market.

The ratings methodology makes sophisticated use of over 40 industry, economic and demographic data points.

Company Profiles

Examines the competitive positioning and short- to medium-term business strategies of key industry players. Strategy is examined within the context of BMI's industry forecasts, our macroeconomic views and our understanding of the wider competitive landscape to generate Company SWOT analyses.

The latest financial and operating statistics and key company developments are also incorporated within the company profiles, enabling a full evaluation of recent company performance and future growth prospects.

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Testimonials

'An essential, multi-faceted research tool. BMI’s thorough understanding of the major market players enables an informed – and informative – review of the sector’s actual performance, together with useful insights into current industry issues, which are topped-off with detailed and invaluable forecasts of industry and macroeconomic trends.’

Senior Research Analyst, ABC International Bank plc