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Greek Real Estate: Time To Buy

Improving conditions in the periphery are creating opportunities for investors in commercial real estate. Indeed, stabilization in Europe has translated to improvements across the board in terms of upside in the CRE market, but the improvement in Greece has been remarkable. It is now time to cautiously enter the Greek CRE market.

Time To Buy Greek Real Estate

As the underlying economic and political conditions improve, so is the outlook for real estate in the periphery, particularly in Greece:

  • There are clear positive signs from within the euro zone. The rise in the Euro over the last year, in part reflects attractive pricing, an improving, if still anemic, economic outlook and positive investor sentiment. This has resulted in increased capital flows and investor activity.
  • Financial indicators are also showing a return to some semblance of normality. Bond yields, while still elevated, are well off their highs during the crisis. Meanwhile banks, which are still harboring major problems, have at least stopped hemorrhaging cash to depositors, including in Greece.

Although there still exists major problems in Greece, not least unemployment, the worst is now over (the country’s economy has shrunk by over a quarter in real terms). The companies that are still standing in Greece are the survivors that will be able to withstand significant economic fluctuations. For commercial real estate investors, these companies will provide a solid base of tenant income with a recovery play.

Finally, Greek CRE is offering great income. In cyclical terms, yields are now at their highest level in over a decade. Our Global Real Estate Strategy service recommends adding Greek commercial real estate to portfolios.