Too many question marks

Expo Real’s organizers can celebrate another large increase in participants and exhibitor numbers. However, the atmosphere during the fair was pretty heavy, as there were too many question marks hanging over the future of the real estate market.

The 11th International Commercial Property Exposition, which took place in Munich from October 6th-8th, attracted 24,500 visitors from 77 countries (23,800 in 2007) together with over 17,500 company representatives on the exhibition stands. A big crowd, which in the past would have been busy discussing long lists of potential deals, was this year more worried about the future. The main topic was “What’s next?”

There was no simple answer, especially as the situation kept changing very quickly. CNN was reporting world stock exchange indexes sharply dropping and the number of international banks crying out for help. In Munich, Austrians, Poles and many other participants were surprised by the news – announced during the first day of the fair – that Karl Petrikovics, CEO of Austria’s Immofinanz (who was supposed to take part in one of the panel discussions), had stepped down due to internal pressures. Bankers present at Expo Real, when asked about their current policy, were giving short answers along the lines of: “Wait and see, until the end of 2008 at least.” And so was almost everyone else.

This uncertainty, albeit mixed with several welcome drops 
of optimism, captured the prevailing mood of the ‘Investment Locations Forums’, at which panelists discussed particular markets, including most CEE countries: Bulgaria, Hungary, Romania, Russia, Serbia, Ukraine and Poland. The Polish market was addressed by Alan Colquhoun 
of DTZ, Robert Dobrzycki of Panattoni Europe, Maciej Krenek of Raiffeisen Evolution Project Development and Michał Sękowski of DLA Piper. The four men stressed the strong fundamentals of the Polish economy, which, they said, made Poland less vulnerable to the financial storm. In their opinion, a slowdown in the market couldn’t be avoided, with the residential and investment sectors most affected by the crisis. On the other hand, they agreed, the storm would have a “cleaning impact”, meaning that the strongest companies, those with experience, a good track record and a valuable portfolio of well located properties, would win through.

While this Expo Real was worth attending, the next one will be even more worthwhile, if only to see who’ll be there and what they’ll be discussing. Messe Munchen invites everybody on October 5th-7th 2009. ν