Investment in Czech commercial real estate reached its highest level since early 2020 during the first quarter of this year, totalling CZK 37 billion (EUR 1.47 billion). This figure represents a threefold increase compared to the same period in 2024, according to an analysis conducted by real estate consultancy Knight Frank. Domestic investors played a key role in driving this growth, while U.S.-based capital also accounted for a significant share of activity, representing one-third of the total volume. Much of this was attributed to a large-scale acquisition by the American investment firm Blackstone. The largest share of investment was directed toward industrial and warehouse properties, which accounted for 25% of total volume. Multifunctional buildings followed closely with a 24% share, while hotels made up 23%. One of the quarter’s most notable transactions was Blackstone’s acquisition of CT Real Estate, a portfolio comprising ten logistics parks, seven of which are located in the Czech Republic. Blackstone is also in the process of acquiring a majority stake in Contera’s industrial property portfolio. Knight Frank analysts view these moves as evidence of the continued appeal of the Czech real estate market to foreign investors. The hospitality sector also recorded a significant transaction, with PPF Hospitality acquiring the Hilton Prague Hotel. Knight Frank interprets this as a signal of investor confidence in the recovery of tourism and the stability of revenues in the hospitality sector. Other prominent transactions during the quarter included Redstone’s acquisition of the Atrium Flora and Myslbek retail and office complexes in Prague. These multifunctional buildings, which blend commercial and office uses, are viewed as attractive investment options due to their ability to diversify real estate portfolios. According to Josef Karas, Investment Manager at Knight Frank, further growth is expected in the office property segment throughout 2025. He noted that local capital, particularly from domestic real estate funds, is likely to continue driving demand, supported by the Czech National Bank’s recent decision to reduce the repo rate. Karas also highlighted ongoing interest from international investors, especially in the industrial and logistics sectors. Revenue yields across most segments remained stable quarter-on-quarter. The exception was in prime office buildings and retail properties located on high streets, where yields declined by 0.25 percentage points. Currently, yields average 5.25% for office properties, 6.00% for shopping malls and retail parks, 4.50% for high-street retail and rental apartments, and 5.00% for industrial and logistics assets. Knight Frank’s findings suggest that the Czech commercial real estate market is gaining momentum, with a mix of local and international capital showing renewed confidence across key segments. Source: CTK