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Commercial property investment volumes in Central and Eastern Europe (CEE) amounted to EUR 900 mln during the first quarter of 2012 (Q1 2012) - the lowest volume seen since Q3 2009 - according to the latest data from CBRE.

The underlying factors behind the lower volumes relate to less financing being available and narrowing investor requirements. Most property transaction activity occurred in Poland during the quarter, a continuation of the overall trend seen so far in 2012. One notable exception to this trend was the sale of City Business Centre in Timisoara to New Europe Property Investment (NEPI).

'Continuing pressure on real estate finance has resulted in a significantly changed spectrum of active real estate financiers across CEE,' said Jos Tromp, head of CEE Research & Consultancy, CBRE. 'Most active financiers are focused on Central Europe with Poland and the Czech Republic clearly outstanding. However, bank requirements regarding margins and ratios combined with a general risk averse outlook are restricting deal flow to the prime end of the market even in these markets. Standing investments are clearly favoured with development financing increasingly challenging to obtain, a factor which is already significantly affecting the development pipeline across CEE.'

Property deal flow in Slovakia, and especially in Hungary, is expected to be mostly dependent on existing client relations as well as equity buyers moving into these markets where interesting capital growth potential is offered. Unless new types of financiers come forward a significant increase of liquidity is not expected soon and these markets will remain dependent on one-off property transactions.