Turkish government lifts suspension on issuing title deeds to foreigners
The Turkish government has announced the end of a temporary suspension on the issuing of title deeds to foreign buyers. The suspension, which was introduced in mid-April, is expected to end in early-June when the Turkish Constitutional Court will have re-drafted the legislation relating to foreign buyers, now that the parliamentary commission has agreed to the changes.
The changes mainly relate to the amount of land foreigners are allowed to buy. Dominic Whiting, editor of the Buying in Turkey guide, reports: “Previously, non-nationals could buy up to 0.5% of the land in a province; this is now limited to 10% of any town, city or resort, which is still a huge area.”
Foreigners are also not allowed to buy property and land in rural areas that are ‘un-zoned’.
John Howell, senior partner at The International Law Partnership LLP says: “Land registries in Turkey will now be able to process new registrations of property Title Deeds for both foreign nationals and foreign companies. The question was not whether foreign nationals should be allowed to acquire land in Turkey but whether Parliament or the Government should relax limitations as to the size of land foreigners can purchase.”
The new law also gives the right to the Council of Ministers to change the 10% limit for each town by considering the town’s infrastructure or economical status. However, it can only reduce the ratio, which means it cannot rise above 10%.
Government-led investment is currently transforming the coastal tourist areas of Turkey with new airports, roads, marinas and golf courses in resorts such as Dalaman, Bodrum, and Alanya.
New bridge to link Sicily with mainland Italy
The Italian government has agreed to invest over €4bn to improve the country’s transport infrastructure and has reportedly finally given the green light for the construction of a road-rail bridge linking Sicily with mainland Italy.
The idea was first conceived in 2001 under then president Silvio Berlusconi but was then shelved by Italy’s outgoing centre-left government. However, since the re-election of Berlusconi last month, it has been reported that the project will go forward and will be built by a consortium including Italy’s largest developer Impregilo.
Last week, Impregilo’s president, Antonio Talarico, told news agency Reuters that the consortium was still working on the project – which will be the world’s largest suspension bridge ever built at a cost of over €3bn.
The bridge is expected to take at least 5 years, and possibly up to 10 years, to complete. At the moment Sicily’s growth is being driven by the arrival of low-cost airlines.
In a separate development the new government has also awarded another consortium a €580m contract to construct a series of motorways and transport links connecting the port town of Ancona with the country’s major highways.
European office market remains strong says JLL
Occupier demand in the European office market remains strong, but rental growth shows signs of slowing this year, according to Jones Lang LaSalle’s (JLL) Q1 2008 European Office Property Clock.
The office rental index grew by 1.0% over the quarter and 8.9% over the year with six markets showing prime rent increases, led by Milan (+14%) and Warsaw (+10%). Brussels was the exception, where rents decreased by 1.7%, according to JLL.
Despite job losses in the financial sector, European labour markets remained in good condition, driving office demand. In Q1 2008 take-up of almost 3.2m sqm was recorded. Although this represents a decrease of 7% in comparison to the same quarter last year, it is still 25% above the five year average.
At a city level the highest increase in office take-up over the year was recorded in Prague (+83%).
London ’s West End remains the most expensive in Europe for prime office rents, costing €1,553sqm pa (£1230sqm).
European office completions have been moderate at around 1.1m sqm in Q1 2008, well below the volumes witnessed over the last three quarters. However, more than 7.2m sqm are anticipated to be completed by the end of this year, driven mainly by the booming Moscow market with nearly 2.4m sqm of expected completions.
Worldwide News
New research reveals most popular overseas property destinations
A new study by Globaledge.co.uk has revealed the most searched-for overseas property destinations by UK internet users. The research looked at over 200,000 property-related searches over the last 100 days from the UK Wordtracker database and grouped them by overseas property location.
Spain came top of the list, accounting for over 10% of total searches and the list is dotted with numerous Spanish towns and coastal names. Although the obvious locations of Costa Blanca and Costa del Sol were the most popular regions, the popularity of the Canary Islands was the most interesting finding. The company reported considerable search interest for Costa Teguise (Lanzarote), Palm Mar (Tenerife), and Caleta de Fuste ( Fuerteventura).
France, Bulgaria, Cyprus and Turkey were next after Spain, but perhaps the biggest surprise was Italy which came back in 21 st position. Italian regions also faired badly with only Umbra, Puglia and Le Marche making the cut. Globaledge.co.uk director Ashley Rigg said: “In economic terms, Italy has been dubbed the sick man of Europe and buying there is incredibly complicated. It’s also expensive in many regions, which is probably why Tuscany doesn’t make the list at all. It could be a while until in comes back into fashion.”
In the emerging markets, the usual suspects of Bulgaria and Dubai both featured in the top ten and Morocco came in at number 13. Prague also made it into the top 20. “The Czech Republic is one of the best performing economies in Central and Eastern Europe and finance is easily available. It’s even possible to get 100% mortgages. News of the opportunities have obviously filtered through to the British public”, said Rigg.
Brazil came next, followed by Romania and Slovakia but one country that is still not attracting many searches is Egypt, which only came 57th on the list despite “having some of the best rental yields and growth prospects in the world”, according to Rigg. He added: “It has had quite a bit of press recently but it maybe the perceived political risks that are turning investors off.”
At the bottom of the list (101 st position) came Estonia which generated just 0.03% of total inquiries, or 60 from 200,000.
Commercial property transactions to fall by 17% this year
Global deal volumes for commercial real estate will fall 17% in 2008 as a result of economic uncertainty caused by the credit crunch, according to new research. Property consultant Cushman & Wakefield’s International Investment Atlas summary for 2008 predicts total dealing volumes will fall from $930bn in 2007 to about $770bn by the end of this year.
Despite a probable decline in deal volumes, the predicted total for 2008 remains high by historic standards according to the company, which adds that the figure is still three times the level of trading seen just five years ago.
Emerging markets will see their share of global activity increase from 7.3% in 2007 to nearly 12% in 2008. The report states: “Activity in emerging economies will remain robust, with further gains in emerging Europe, Latin America and Asia.”
Demand will still remain strong for quality property from well-qualified buyers as well as opportunity funds created to take advantage of changing market conditions.
Japan faces backlog of unsold new homes
A growing backlog of unsold new homes in Japan is threatening to dent already feeble economic growth. One analyst has predicted that the slow housing market could knock a full percentage point off of GDP growth this year.
At the root of Japan’s housing crises is a scandal over falsified engineering data for new residential buildings that prompted an overhaul of regulations. New rules were introduced in June, requiring additional checks of structural calculations for new buildings and this has delayed construction approvals by several months.
Furthermore, government officials had failed to get the guidelines on the new rules ready in time, keeping the market in a limbo for two months. As a result, housing starts in the second half of last year plunged 30% compared to the second half of 2006.
However, just as the effect of the new regulations began tapering off, so did demand. Developers found it hard to sell condominiums to consumers that were worried by stagnant wages and worsening business prospects.
The growing backlog of unsold homes has now affected new construction and the latest available data from March showed housing starts plunged 15.6% compared to a year earlier.
Sales of new condominiums fell to a 14-year low in Tokyo and neighboring prefectures in the year to March, while average prices hit a 15-year high, according to the Real Estate Economic Institute, a property market research firm.
Some developers are now offering discounts of up to 20% for unsold new homes that have already been completed. However, for most developers the squeeze is likely to get worse before it gets better as higher costs of oil, steel and other raw materials as well rising land prices in urban areas make it harder for them to cut prices aggressively and clear out inventories.
But industry officials said consumers were unlikely to budge and would hold out for substantial price cuts, delaying any swift recovery in the housing market.
Abu Dhabi Island to be turned into business zone
Mubadala Development Co, an Abu Dhabi investment arm which manages over $10bn in assets, has announced that it will develop an offshore island into a new business district that will eventually house the stock exchange.
Suwa Island, off Abu Dhabi’s coast, will be developed by John Buck International, a joint venture Mubadala set up in March with Chicago-based real estate firm The John Buck Co.
“It is a multi-billion dirham development and construction has already started”, Carlos Obeid, Mubadala’s chief financial officer, told a news conference. “The island will be home to the new headquarters of the Abu Dhabi Securities Exchange.”
Obeid said the 570,000sqm development will include commercial and residential buildings as well as a hotel and retail space. “There is tremendous demand for commercial real estate in Abu Dhabi fuelled by the growth of the economy”, he said.
Bulgarian trains to travel at up to 200km/hour
Some Bulgaria trains will travel as fast as 200km/h once EU funding of around €580m has been absorbed for the modernization and reconstruction of Bulgaria’s railways by 2013.
The news was announced by the press service of the Bulgarian National Railway Infrastructure Company (NRIC). The funds have been allocated for the development of the railway transport in Bulgaria, which is a priority for the EU.
The EUR 580m is 29% of the total budget of the Operative Program Transport for Bulgaria. This makes the NRIC the second largest beneficiary of the program after the Republic Road Infrastructure Fund, Bulgaria’s road agency.
The EU funds will be used by the NRIC to modernize four railway lines: the Sofia-Vidin Line, which leads to Romania through the future Danube Bridge 2, the Plovdiv-Svilengrad Line leading to the border with Turkey, the Sofia-Plovdiv Line, and the Sofia-Pernik-Radomir Line.
The Sofia-Vidin Line project is the largest, costing €320m, and will allow the trains to run at 200km/h. Thus, the duration of the trip, which is currently five hours and ten minutes, will be reduced to about three hours.
The Sofia-Plovdiv Line will also allow trains to run at 200km/h, reducing the journey by over one hour to around 90 minutes.
Virtually no infrastructure investments have been made in the Bulgarian railways in the last 20-30 years. At most sections of the railway lines the trains presently run at no more than 50km/h.
