Euro hampers real estate growth at Estonian Post
Estonian Post has blamed the Baltic state’s joining of the euro currency this time last year for slower progress in its real estate division over the past 12 months. The postal operator sold 11 properties in 2011, compared to a total of 43 sold over the past three years.
It currently has 63 properties on its books, using the proceeds from the sale of properties to invest in its logistics and information logistics services in Estonia, Latvia and Lithuania.
Kaido Padar, head of real estate sales for Estonian Post’s administrative division, said the sale of properties was being hampered by the difficulty people are having securing bank loans in the current economy, with a number of potential sales falling through as a result in 2011.
“Introduction of the euro in 2011 did not help the Post increase interest in its real estate business,” he said.
“While real estate experts said that only apartments are being purchased and that people are in a standby mode, interest gained momentum in the second half of the year and there were many more offers.”
Padar insisted that although there was no growth in the real estate division in 2011, “it was a successful year for us”.
Estonian Post is setting itself up as a service company and in the next few years aims to extend its real estate activities into the rental market, which is where the market is moving, it said.