Real Estate

Author: Don Hill

Sales and rentals of real estate in the Czech Republic, and especially in thecapital, Prague, are booming.

This boom is genuine. It does not flow from the kind of "irrationalexuberance" that U.S. economist Alan Greenspan once warned his countrymen toavoid.

The robust health of the real property markets here covers every segment:middle- and high-end residential, hospitality, retail, office and industrial.And it is founded on the strongest economic growth in the country´s history.

The government numbers for last year are out. They show that the Czech GrossDomestic Product, or GDP, remained this year at 2005´s high of 6.1 percent.

Some leading analysts say that this is the peak and that annual economicgrowth will level off now at a sustainable 5 percent. Household spending remainsstrong, inflation moderate and long-term investors active.

Of the trio of CEE nations that entered the European Union in 2004 - theCzech Republic, Hungary and Poland -- the Czechs far-and-away have blossomedmost in the free markets. Boutique hotels & Serviced Apartments

Much of the strength of today´s Czech economy stems from tourism. Prague, the"city of a thousand spires," has become also the city of 100 four- and five-starhotels. Leading the way in the last two years has been the march of a phenomenonknown as boutique hotels. These are small, often expensive hostelries withindividual personalities. A recent example: the Mandarin Oriental, housed in aformer 14th century monastery in Mala Strana,

Gentrifying Zizkov

Residential development also is powering real estate action. The present kingof this segment is Central Park Praha, part of 50 hectares of land where Zizkovmeets Vinohrady, from near Hlavni Nadrazi to Olsanska hrzbitov (cemetery).

At a cost of 4 billion crowns, developer CPP Development is constructing 180of what it calls "luxury residential apartments," already virtually sold out atprices from 10 million crowns each to twice that.

CPP Development´s Managing Director Milan Ganik recently told The Prague Postthat he is untroubled by the Zizkov neighborhood´s raffish reputation andhistory. Zizkov won´t tarnish CPP, he said in effect. CPP will gentrifyZizkov.

In the Beginning

After the communist regime fell in 1989, the new Czech government placedprivatization of state properties near the top of its agenda. Despiteprivatization´s many stumbles and missteps, history has validated thisstrategy.

Privatization and its cousin, restitution, ignited the engines and the energyof private ownership. The result, in just a decade and a half, is evident in thecheery facades, the builders´ scaffolding, the merchandise-stuffed shops and thescurrying crowds that are ubiquitous in Prague, and to a lesser extent in otherCzech cities.

References: www.real-estate-prague-agents.com