It was pipped at the post by Tokyo to host the 2020 Olympics, but Istanbul in Turkey has plenty to smile about - and plenty to offer investors - going into 2014.
Turkey has recorded consistently strong GDP throughout the economic downturn - unlike most European countries – and is doing all it can to attract more foreign investment. It seems to be working: sales to foreign buyers are expected to reach $3 billion in 2013, compared to $2.64 billion in 2012, according to Turkey’s Real Estate Investment Trust Association (GYODER). Overall property sales in Turkey were up 78.7 per cent in the first half of 2013 compared to last year, added GYODER in October.
Key to Turkey’s ongoing growth is Prime Minister Erdogan’s aim to establish Istanbul as a strategic economic hub that bridges East and West, making it a stepping stone into the West for Islamic nations and vice versa.
The increasing number of global brands and financial institutions establishing a presence in the city, together with the landmark new Marmaray tunnel under the Bosphorus, which opened in October and connects the city’s European and Asian sides by rail, and the launch of the world’s largest airport there are all proof things are progressing.
It’s little wonder then that Istanbul took centre stage at the Cityscape property exhibition in Dubai in October, an ideal opportunity to target wealthy investors from around the Gulf.
Julian Walker, Director at Turkey property specialist Spot Blue International Property, said: “Projects promoted at Cityscape highlighted the immense scale of residential and mixed use projects planned in Istanbul over coming years. Take for example Vadistanbul, a 1.1million-square-metre project between the northern Maslak district of the city and Belgrad Forest, which will be a modern town split into three architecturally distinct parts.
Not to mention the mixed use Trump Towers Istanbul, the first Trump branded project in Europe. It’s over a year since Turkey changed its reciprocity law, meaning non-EU residents can buy there more freely, and we are certainly seeing the effects – and projects like these catch the eye of Middle Eastern buyers.”
The developer of Istanbul’s largest real estate project, Maslak 1435 in Istanbul, opened an office in Dubai on account of the high level of interest it received. The same developer reported that Gulf investors have accounted for sales worth $800million since the reciprocity law referred to by Walker was dropped in 2012.
Spearheading the city’s plans to become a financial hub is the Istanbul International Financial Centre (IIFC). “As integral to the future of Istanbul as any of the shiny new developments on show at Cityscape is the IIFC,” added Walker. “Modelled on Dubai’s financial centre, work began on the IIFC on the Asian side of the city this year and it is expected to be completed by 2016, when Istanbul can set its sights on becoming a global financial centre.”
Meanwhile, a report by property consultancy Cushman Wakefield supported Turkey’s appeal for commercial investment opportunities – the country completed the second largest amount of new shopping space anywhere in Europe during the first half of 2013 and is second in terms of shopping space – measured as gross leasable area (GLA) – in the pipeline for the next 18 months. Over 1.5 million square metres of GLA are scheduled to be completed in the country, with nearly a third of this planned for Istanbul.