Historic apartment buildings were also in demand in 2019 and were a popular choice among real estate investors.
After acquisition and renovation, investors mostly split and sell these properties in separate apartments or form rental houses. Local investors dominate among buyers of historic house properties, but the number of foreign investors is also gradually increasing. While local investors mostly specialise in selling property by separate apartments, foreign investors are more likely to be interested in development and long-term renting of rental houses.
In 2019, the total amount of investment in the acquisition of apartment buildings with the main function of living space was EUR 20 million, which is a significant decrease compared to 2018, when investments in acquisition amounted to EUR 50 million. The decline in investment compared to the last year is a combination of many factors and mainly—access to finance for developers, high construction costs and lack of adequate offers.
It is important to take into account that in such projects, depending on the condition of the property and the level of finish, investments in renovation often exceed the purchase value of the property.
The city of Riga is definitely the winner as a result of these deals: historic buildings are being reconstructed and preserved, while the supply of quality housing is being simultaneously expanded.
In 2019, the team of KIVI REAL ESTATE took part in several historical apartment building sale transactions.
Including representation of owners in two significant transactions at 5 Miera Street and 14 Marijas Street.