Financial in a Nutshell’s Post

Kicking off our Publication Cycle for this quarter, is our Emerging Europe (EME) Desk, focusing on the Renewables and Energy (R&E) industry in Hungary! In this quarter's edition of Executive Briefs (EBs) by EME, we take a deep dive into Hungary's economy going into 2024, and what the 2nd half of the year has in store for the currently rapidly expanding economy. Hungary’s government has been doing well by turning the economy around positively from a technical recession in 2023 to a positive growth. The economy is seen to only be growing further with its hopes pinned on export recovery. Our desk consisting of Desk Director Aw Kai Rui and Associates Si Ning Lai and Tiffany Ang, lead us through a bullish analysis into the future of the Hungary economy amid positive macro indicators to leverage on favourable EU support. == This EB is part of a 3-part release by our EME desk covering the macro economy, industry, and company. Our Publication Cycles run at the end of every quarter for each of our 5 desks, with each quarter covering a different area of research spanning across - Fast Moving Consumer Goods (FMCG), Financial Institutions (FI), Industrial Corporate Groups (ICG), and Resource & Energy (R&E). Check out our other Publications here: https://lnkd.in/gwh9UESH If you wish to find out more, do reach out to us at sem@sa.smu.edu.sg or contact our President, Kai He Ong, or Vice-Presidents Eve Toh and Shang Ze Koh. #emergingmarkets #Hungary #EME #emergingeurope #resourceandenergy #executivebrief #SMUEM

CEE Investment volume growth rates Investment volume growth in the Czech Republic is showing a positive trend, with a 5% increase in 2024 H1 compared to 2023 H1. In traditional sectors like office and retail, investors are leaning towards “Core+” and “Value-Add” opportunities. The industrial sector is also seeing significant activity, with some prime transactions recently closed or soon to be announced.   If larger transactions currently in the pipeline conclude during the second half of 2024, the total investment volume for the year could potentially exceed £1.4 billion. While the market remains challenging, signs of optimism are beginning to emerge. Source: ARETE, data: Colliers #CzechRepublic #InvestmentTrends #CommercialRealEstate #PropertyMarket #OfficeRealEstate #RetailRealEstate #IndustrialRealEstate #CorePlus ARETE

Shaping Investment Trends in Europe   Investment activity in Europe is showing promising signs of recovery as we progress through 2024. The gap between sellers' and buyers' price expectations is narrowing, marking a positive shift after significant price drops over the past 18 months.   Investment volume in Europe for the second quarter has surged by 19% compared to the previous quarter, and the rolling 4-quarters investment volume has increased by 1.3% from first quarter, marking the first positive improvement since Q3 2022. There has been a notable increase in high-leverage transactions, buoyed by improved conditions in the debt market.   For the first half of 2024, investment volume in Europe is expected to exceed €74 billion. Several countries, including the Czech Republic and Poland, anticipate year-over-year growth in investment volume during this period.   Investors are maintaining a selective approach, focusing on assets that promise the highest returns through robust profit growth and favourable supply and demand dynamics. Consequently, sectors such as logistics, multifamily, and hospitality are seeing strong investor interest. Source: ARETE, data: Savills #EuropeanInvestment #InvestmentTrends #RealEstateInvesting #MarketInsights #EconomicRecovery ARETE

At €1.2 billion, the first quarter of 2024 saw CEE investment volumes decline by ca. 15% YoY. According to preliminary results, this is largely in line with European and Global results. Given the current conditions, particularly in relation to the continued elevated cost of debt, we expect 2024 volumes could reach up to €6.0 billion. Check our Q1 2024 CEE Investment Scene report here https://lnkd.in/dSmaZFdP

E.ON to Increase Investments in Europe E.ON said that it would invest €42 billion in the period to 2028 in Europe, with a majority planned for Germany, and added that it anticipated its earnings this year would normalize. - The Wall Street Journal U.S. Business source: https://ift.tt/Tr7u04a E.ON to Increase Investments in Europe E.ON said that it would invest €42 billion in the period to 2028 in Europe, with a majority planned for Germany, and added that it anticipated its earnings this year would normalize. - The Wall Street Journal U.S. Business source: https://ift.tt/Tr7u04a https://ift.tt/0CY9MDz

The latest Economist Intelligence: EIU report on Europe’s 2024 outlook confirmed what we’ve been noticing — Romania is steadily advancing as one of the most improved business environments in #CEE. Over the past two decades, Romania’s business environment score has improved by 1 point, driven by its EU membership, which has strengthened regulatory frameworks and unlocked significant investment opportunities. Alongside other CEE countries in the top 10 global rankings for business environment improvements, Romania is positioning itself as a key player in Europe’s growth story, with expectations to reach a score of 7.1 out of 10 by 2028. At iO Partners, we are focused on harnessing these positive trends to further our mission of becoming the first choice in real estate consultancy in CEE. The ongoing development in #infrastructure, market #opportunities, and policy frameworks provides fertile ground for growth, and we are ready to seize these opportunities. As Romania and the region continue on this upward path, we are committed to supporting and leading #realestate projects that contribute to this dynamic progress. The full report is available here: https://lnkd.in/dywkPAWX

I recommend reading the latest edition of the EY European Attractiveness Survey. It discusses the first downturn in FDI in Europe since 2020, due to slow economic growth, high inflation, soaring energy prices, and a volatile geopolitical environment. However, the new data suggest that the investment levels could rebound quickly/soon, as investors are reorganising their European operations, shortening nearshore supply chains, and investing in innovation centers. Nevertheless, the majority of new projects will most likely focus on expanding the existing assets rather than on the new greenfield investments associated most often with high-potential industries, such as electric vehicles, life sciences, digital technology and renewable energy. The new regulations, variable energy prices and political instability are the greatest threats to FDI recovery.   The overall decrease marks an increasingly mixed landscape, with some sectors and countries significantly outperforming others. As you will see below:   ·            No. of FDI projects in Turkey has increased by 17% y/y; ·            Poland is no. 4 in Europe in terms of jobs resulting from FDI projects announced in 2023; ·            No. of jobs announced in the Czech Republic thanks to FDI projects announced in 2023 increased by 258% y/y; You will find more detailed information here: https://lnkd.in/dcZhsAWR #EAS #directinvestment #investments #FDI

🌍🔍 Our latest cycle phase analysis shows a turning point in industrial production for many developed economies! 🌟 Highlights: - France, Sweden, and Slovakia are leading Europe's recovery. - The US and UK are approaching or at cyclical troughs, poised for recovery in late 2024. - Germany, Belgium, and Netherlands are still contracting but decline is slowing. Growth is expected towards the end of 2024 and into 2025. With easing energy costs and anticipated rate cuts, we foresee a significant industrial upturn later this year, supporting growth into 2024. 🚀📈 Check out our full report to learn more: https://lnkd.in/ebiD2x_K #EconomicGrowth #IndustrialProduction #EconomicForecast #IndustryForecast

According to Oxford Economics, Central and Eastern European (CEE) industrial sectors should benefit from a pick-up in domestic and, later, external demand in H2 2024 and 2025. But the outlook is much less clear in the medium term, when major transformational requirements will be placed on the sector. OE baseline projects CEE industrial production will grow by an average rate of 2.8% in 2025-2030, above the 2.4% expected in Germany and the eurozone. Manufacturing productivity growth will outstrip Western Europe too. Nearshoring of production and shortening of the supply chain are the biggest opportunities for CEE industries. External demand and in particular but the capital-intensive green transition could benefit CEE manufacturers if they adapt to new technologies. CEE is still broadly competitive in terms of labour costs. Despite the fast catch-up in nominal labour costs over the last decade, they are still less than half of the EU average. But poor demographic outlook, biting labour shortages, and the ongoing fragmentation of global trade coupled with a rise of industrial policies are all headwinds for the CEE industries. #CEE #supplychain #nearshoring https://lnkd.in/dbg2kYTV

We’re seeing momentum continue to improve across European I&L Capital Markets, with investment volumes rising 9% year-on-year during H1 2024 to €16.2bn. The majority of markets across the region boasted increases in investment compared with H1 2023, with Belgium the standout performer, fuelled by a large, platform transaction in Q1.   Looking at the source of the capital deployed over the past 12 months, 70% came from within Europe.  With H1 volumes reaching half of the 2023 total, the outlook for investment should improve further, as lower rates feed through to sentiment. Read our most recent research, focused on H1 Capital Markets activity here. https://lnkd.in/gtf46NuF CBRE Capital Markets CBRE Industrial & Logistics Pol Marfà Miró Tasos Vezyridis CBRE UK