Cyprus Commercial Real Estate Investment in 2022: How to Make Enough Money?

Commercial property investment in Cyprus has been on a steady growth trajectory. There are great rewards to be gained from investing in commercial property. It is often seen as riskier than residential property investment. You need to be able to spot neighborhoods that are about to develop rapidly. 

Additionally, it is important to understand what demand there already is in certain areas. We will take a look at what makes these particular locations attractive to investors and how you can join them.

What is commercial real estate?

Commercial real estate is typically used for business purposes and workspaces, rather than living space. It covers a wide range of businesses, from small restaurants to large-scale retail parks.

Investors can invest in a property through either direct ownership or indirect investments. 

The indirect way of investing in real estate is through REITS. However, commercial property is also not without its risks. People have reported drops in values, damages to the properties and even malfunctions. Despite all this, it offers potential for great rewards. 

Tenants are more likely than homeowners to take care of commercial property. That is because the lease period is often longer.

The advantage with commercial real estate is that its value usually increases at a faster rate than residential property.

Commercial real estate is the most common form of property used for business purposes. It’s typically not residential. The value of these assets increases at a much faster rate than residential real estate.

The importance of location

Location is key when it comes to commercial property investments. There is always something on offer when it comes to residential real estate. The challenge is that it’s much more difficult to find the perfect location. You need to find a location that has commercial properties near quality facilities and infrastructure. 

The key to making sure your project stands out among others through high-quality standards. Higher-quality buildings are always going to be in high demand, no matter where and when. There are a number of options available in Cyprus. You should take a look at each region and its unique features before making your final decision.

Overview of the commercial property investment regions in Cyprus

Larnaca may be the up-and-coming investment hub of Cyprus. Previously, the city has trailed behind other major cities. The retail sector is experiencing an exciting time. 

The city of Limassol is a major maritime center for the island. It has been one of the most popular areas among foreign investors. The price of apartments increased by 8.3%. Investors are now seeking out smaller cities for commercial developments

It is not uncommon for people living in Cyprus to work near their homes. Prices of property in Limassol are continuing to skyrocket. Demand for domestic real estate is booming. Investors are therefore turning their attention towards commercial properties in other cities.

Nicosia, the capital of Cyprus, is well known for its commercial properties. The city is a hub for all businesses related to legal affairs and the government. This way, it can be an ideal destination for those looking to do business in Cyprus.

Capital and rental value of office spaces

The economy of Cyprus has been steadily growing since 2015. In the last year, economic activity increased by 2%. The number of unemployed has reduced as well and now the demand for office spaces has increased as projected. 

In Limassol’s case the city’s office premises saw an increase in capital value in 2016. At the end of 2019, office values were at €2.639 per square meter on average. It represents a 42% growth over the end of 2015.

Nicosia has the highest average per square meter since it is the capital city. Next up is Limassol. It is the biggest port in Cyprus and thus, experienced significant price growth in rental and investment into commercial property in the recent years.

The latest commercial property investment in Cyprus

The first type of commercial investment we will discuss is retail property. The latest projects in this sector include the Neo Plaza in Nicosia and Metropolis Mall.

The retail space will increase by 450,000 square meters once these developments are completed. There is a recent influx of new foreign investors. It is a clear indication that the areas around Larnaca have become increasingly popular.

The demand for office space in Cyprus has been on the rise recently. More businesses are looking for downtown office space and reasonable commute times. There has never been a better time to invest in commercial property. It’s estimated that there are 260,000 square meters of office buildings ready to be filled. They will be opened by the end of 2022. Furthermore, the construction of two new marinas is a significant sign for the future economic stability and growth in this region.

Conclusion: The commercial property market in Cyprus is very attractive right now

Commercial real estate is the most common form of property used for business purposes. The value of these assets is typically much higher than residential real estate. There is a lot of interest in Cyprus from international investors. The economy has seen major growth in recent years. The tax system in this country provides significant advantages for companies and the world of business is changing. With it comes the need for new commercial buildings. The tourist industry is also a stable and lucrative sector. It receives constant interest from foreign investors. This is an ideal time for investors because investing in Cyprus can be a profitable and beneficial process with a stable return of investment.