The local commercial real estate market has grown during this time from zero to almost 20 million sq m of modern retail, logistics and office space
Cushman & Wakefield, a leading global real estate services firm, celebrates 30 years of its operation on the Czech commercial property market and recalls the milestones in its development in which it has played a significant role. From 1993, most of the segments have grown practically from zero: modern office buildings, logistics halls, shopping centres and retail parks did not exist then, and the number of hotels in Prague has almost tripled over the 30 years. Real estate transactions reached an overall value of CZK 900 billion during this time.
Cushman & Wakefield in the Czech Republic
The firm was founded in May 1993 as a Czech branch of the British real estate company Healey & Baker; in 2002 it merged with the US firm Cushman & Wakefield, which merged with the British firm DTZ in 2015.
Jonathan Hallett, Head of Central & Eastern Europe, Cushman & Wakefield: “Currently, we employ over 250 colleagues in the Czech Republic, offer a broad range of real estate advisory services, and participate in the most significant property transactions in the Czech Republic and in the CEE and EMEA regions.”
30 years of the Czech real estate market: from zero to tens of millions sq m
The office market has grown over the 30 years to today’s 3.5 million sq m of A-class space according to Western-European standards. The first project of this kind was the IBC building on the border of Prague’s city centre and Karlín, followed by more individual commercial buildings, which created various commercial hubs around the city. From 2002, Chodov with The Park complex was among the first such hubs – and today it is hard to imagine the place where the D1 motorway exits Prague without the big shopping gallery and a row of office buildings with renowned logos on the facades. Similarly, the nearby Brumlovka complex came to life in 2003, thriving despite the lack of metro station. The Karlín district underwent the greatest development, with Danube House, the first building of the River City complex, completed in 2002, the year of the catastrophic floods.
In the past 30 years, all of the current modern shopping centres were built – and now there are 107 of them in the Czech Republic, totalling 2,600,000 sq m. Tesco Letňany, Černý Most, Galerie Myslbek, Nový Smíchov and Metropole Zličín were among the first, with Olympia and Avion in Brno. Prague’s high street has also developed – with careful selection of its retail tenants helping cultivate the whole environment of for example Wenceslas Square or Na Příkopě street. Over the three decades, hundreds of significant retail brands from abroad were successfully introduced into the Czech Republic, elevating the local retail market to a level comparable to Western markets.
Modern storage / logistics space market has also grown from zero since 1993: the first halls surrounding cities emerged around mid-nineties, with their overall area now exceeding 11 million sq m. Park Rudná, Park Horní Počernice or the development around the D1 highway near Prague are some of the key projects.
Neither retail parks as we know them toady existed 30 years ago; the first one – Avion Shopping Park Praha was built before the turn of the millennium at Zličín. Quickly, they started to emerge around bigger as well as smaller towns across the country which now has 270 retail parks with an overall retail area of nearly two million sq m.
Modern property management underwent great development and professionalization, from its beginnings with small maintenance firms to today’s global facility management providers. Similarly, property management itself has developed from the original basic charts sent to clients by post to today’s sophisticated online reporting tools.
Prague’s hotel market comprised of 194 hotels and roughly 38 thousand beds in 1993; over 30 years, the number has grown to today’s 547 hotels and 80 thousand beds, the city’s total accommodation capacity growing by 109 per cent. Numerous hotels changed owners over the years, with as many as 72 transactions taking place in the past 15 years, for example the InterContinental, Panorama, Parkhotel, Don Giovanni, W Prague, Mandarin Oriental, Marriot Prague, Four Seasons or Hilton Old Town hotels.
During the 30 years of its development, properties with a total value of CZK 900 billion were sold on the Czech real estate investment market, though in the Czech Republic, trading with modern commercial properties started only after the country entered the European Union in 2004.
Cushman & Wakefield: From 10 to 250+ employees, from fax machines to flexibility
In 1993, under the management of Robert Neale, the firm’s first ten employees started working from offices in Jindřišská street. When the company later moved to Melantrichova street, its 20 real estate experts were headed by Stephen Screene. Since 2003, Jonathan Hallett, the current Head of Central & Eastern Europe, has been leading the firm. During this time, Cushman & Wakefield moved offices to Na Příkopě street and later into the Quadrio building, merged with DTZ and grew to over 250 employees.
Some of the staff have been with the firm for nearly all the 30 years of its history and remember among other things the technology progress it has gone through. In 1995, the managing director started using the firm’s first mobile phone; later the employees could access the internet taking turns at one computer where it was available; in 2000 all of them had their personal e-mail accounts set up. On the other hand, some technical devices left the firm over the years: the last fax machine in 2013, the last desktop computer in 2019. After the pandemic, the firm fully embraced the flexible working model and upgraded its office in line with the latest workplace trends, emphasizing employee comfort, state-of-the-art technology enabling various types of work from anywhere and anytime, and DE&I as well as sustainability principles.
The firm’s commitment to better understanding of and taking action on the environmental impact of its operations has recently been confirmed by obtaining the ISO 14001 certification that establishes environmental management system (EMS) criteria. From this year, 28 Cushman & Wakefield branches across Europe are ISO 14001 certified, including the Czech Republic.
Participating on key real estate transactions
In the past 30 years, Cushman & Wakefield participated on many property transactions that represent key milestones of the Czech market. The firm’s outstanding real estate professionals provided leasing services for the Palladium shopping centre in Prague and Olympia in Brno, and helped brands such as H&M, Tiffany or Primark enter the Czech Republic. For seven years, they acted as exclusive leasing agents for the whole River City complex in Karlín; and thanks to fundamental leasing deals helped launch the development of project such as Rustonka (tenant: Amazon), Bubenská 7 (tenant: WPP) and Nová Zbrojovka in Brno (tenant: Kiwi.com). They provided project management services to Amazon fitting out its offices at Blox and Rustonka and designed new offices for Mattoni. They secured the lease of logistics halls for the likes of Continental, Globus, ABB, Rossmann, Vafo, and many more. The hundreds of properties they have managed include the iconic Dancing House and Myslbek, Letňany shopping centre and Radio Free Europe’s offices. They participated on the acquisition of the InterContinental hotel and the sale of the W Prague, Don Giovanni and Panorama hotels; they selected hotel operators for numerous projects, among others for the NH Hotel in Olomouc, one of the largest hotels under an international brand in Czech regional cities. Since 2010, they have assisted with the sale of 37 shopping centres, 41 office buildings, and 20 industrial and logistics parks all over the Czech Republic.
To key players on the real estate market, the firm also provides regular reports on developments in individual commercial real estate sectors, based on continuous data collection and analysis; and serving also to educate the general public.
Jonathan Hallett, Head of Central & Eastern Europe, Cushman & Wakefield: “Today, our firm still takes part in top real estate projects affecting life in Prague and other cities in the Czech Republic and Europe. We provide expert services for example on the Dornych mixed-use project in the centre of Brno or 100 Yards on Prague’s Příkopy; the lease of the first building of Port 7 in Holešovice where Direct pojišťovna opens is office; property management of the Atrium Flora shopping centre; the repositioning of the Fairmont hotel (former InterContinental) and the development of its surrounding area, including the retail part; the sale of 18 shopping centres from Tesco’s CEE portfolio; the transformation of Homepark Zličín (former Avion) with a new Decathlon store; or the leasing of 60 thousand sq m in a top-class storage hall in Cheb which will significantly contribute to the development of the whole region.“