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Colliers: Belarusian ruble is not suitable for real estate market

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Colliers: Belarusian ruble is not suitable for real estate market

Utilization rates in Belarusian rubles significantly complicate, if not stultify financial modeling in relation to real estate projects.

Transfer of commercial real estate from dollars (euros) into Belarusian rubles due to the unpredictability of the exchange course of the latter one will result a building up of only paved areas for parking, markets and kiosks instead of expensive hotels and business centers in Belarus.

The experts of the operator on the real estate market of Colliers International expressed such an opinion, AFN writes.

"Utilization rates in Belarusian rubles significantly complicates, if not stultify financial modeling in relation to real estate projects. Commercial real estate projects might require, as a rule, about 8-13 years to achieve payback. This means that in view of time for the construction and launching of the object, the investor should make a forecast by at least for 10-15 years. At this, it is difficult to model the inflation, changes in rental rates in rubles even for 1-3 years, it is useless to do similar forecasts for the next 10-15 years. In other words investors will be unable to assess the prospects for long-term investments in Belarus, the comments of the company say.

Besides, Colliers believes that during the transition to rubles in rentalism lease agreements will be "mainly of short-term nature due to rates exposure against inflation and the need for their regular indexation".

The transfer of commercial property into rubles due to the absence of stability of the national currency will be the collapse of the national real estate market in its civilized form.

"Cheap projects with super-fast payback periods of 1-3 years will be of high priority: markets (paved areas), kiosks and other ", the comment emphasizes.

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