Dubai: For one of Turkey’s real estate giants, a coup attempt and a war on its borders are details of history — it is rather more focused on another number and which would have far more relevance to the country’s real estate sector going forward.
“Last year, about 60 per cent of foreign investors who acquired property in Turkey came from the Middle East or Islamic countries,” said Burak Kutlug, Chief Business Development Officer at Agaoglu, the developer of the Istanbul International Financial Centre featuring six office towers and one residential on an area of 303,000 square metres. “I believe that come next year we can reasonably expect a major upturn in investor interest in the country — the coup and the conflicts are concerns, yes … but strictly short-term.
“We keep committing major investments — $3 billion (Dh11 billion) on property development — knowing that Middle East investors will keep finding Turkey the ideal place to be in Europe given the Islamic phobia that is there in so many countries.”
In recent years, Turkey has been going all out to pull in such investors, particularly through legislations such as the “reciprocity law”, whereby anyone who commits to a certain level of funding gets to have citizenship rights. “That and the convergence of Turkey and its peoples towards Europe can be a powerful combination,” said Kutlug.
“Investors should not be too concerned with the political developments — we have had four elections and still the country managed to grow by 4.9 per cent. Turkey is the 18th largest economy in the world and those investors who came in early have been making much better returns. The second major jump for the economy is on the way.”
Attractive investment opportunity
According to a survey by CBRE of the living factor in major cities, Istanbul has seen its real estate recording 25 per cent annual growth, closely linked to the gains the country’s economy has had during this period. “Despite average asking prices increasing by 16 per cent over the last year, it still has one of the lowest price values and with the population forecast due to continue rising, Istanbul presents an attractive investment opportunity,” it reports.
According to Kutlug, there’s still quite some sizeable headroom for Istanbul prices to grow. “It’s around $2,300 a square metre — and when investors compare it with the $20,000 per square foot in London or Hong Kong, they will know where the growth is going to come from. The city’s all-round development with the new airport expansion and Eurasia tunnel will more than ensure that.
“And housing remains in short supply ... these are all ingredients for high investor returns.”
