CRE Investors Returning to Estonia

TALLINN, ESTONIA-Some optimism is re-emerging in Estonian real estate, and foreign investor interest, especially from Scandinavia, has increased significantly in the past few months, reports consultant Re&Solution, part of Stockholm-based Newsec.

While only six months ago, nobody would consider buying Estonian assets at yields below 10%, a few recent office deals have been transacted close to 8%, with a couple more in office and retail currently being planned at a similar level, says Re&Solution head of Baltics Investment and Research Neringa Rastenyte. This year, investors are focusing on prime properties, with interest in secondary assets unlikely before 2011.