Commercial Real Estate - Albania | Statista Market Forecast

The Commercial Real Estate market market in Albania is predicted to reach a value of US$11.60bn in 2024.
This projection suggests an annual growth rate (CAGR 2024-2029) of 5.08%, leading to a market volume of US$14.85bn by 2029.
When compared globally, the United States is expected to generate the highest Real Estate value, amounting to US$25.3tn in 2024.
Albania's commercial real estate market is experiencing a surge in demand, driven by foreign investors seeking opportunities in the country's growing economy.

Definition:

Commercial real estate can be defined as properties that are used for business purposes, such as office buildings, retail spaces, warehouses, and industrial properties.

Additional information:

The commercial real estate market contains the value of commercial properties as a key performance indicator. This is the worth of all office buildings, retail spaces warehouses, and industrial properties for the timeline of our data coverage.

Office buildings
Retail spaces
Warehouses
Industrial properties

Residential real estate
Publicly owned buildings used by the local government
Buildings used for public health care services

The Commercial Real Estate market in Albania has been experiencing significant growth and development in recent years.

Customer preferences: One of the key customer preferences driving this growth is the increasing demand for modern and high-quality office spaces. As the economy continues to expand and attract foreign investment, businesses in Albania are seeking professional and well-equipped office spaces to accommodate their growing operations. Additionally, there is a growing trend among businesses to move away from traditional office layouts and opt for more flexible and collaborative workspaces. This shift in customer preferences has led to the emergence of co-working spaces and shared office facilities in Albania.

Trends in the market: One of the prominent trends in the Commercial Real Estate market in Albania is the rise of mixed-use developments. Developers are increasingly incorporating a combination of residential, commercial, and retail spaces in their projects to create vibrant and self-sustaining communities. These mixed-use developments not only cater to the growing demand for housing but also provide convenient access to amenities and services, thereby enhancing the overall quality of life for residents. Another trend in the market is the increasing investment in the hospitality sector. Albania has seen a surge in tourism in recent years, with more visitors flocking to its beautiful beaches and historic sites. This has resulted in a growing demand for hotels, resorts, and other accommodation options. Investors are capitalizing on this trend by developing new hospitality projects and renovating existing properties to meet the needs of both domestic and international tourists.

Local special circumstances: One of the unique aspects of the Commercial Real Estate market in Albania is the presence of a large diaspora community. Many Albanians who have emigrated to other countries maintain strong ties to their homeland and often invest in real estate as a way to preserve their cultural heritage and maintain connections with their families. This has contributed to the demand for residential properties, especially in popular tourist destinations and major cities.

Underlying macroeconomic factors: The growth and development of the Commercial Real Estate market in Albania can be attributed to several underlying macroeconomic factors. Firstly, the country has made significant progress in its economic reforms and integration with the European Union. This has attracted foreign direct investment and stimulated economic growth, leading to increased demand for commercial properties. Furthermore, the government has implemented favorable policies and incentives to encourage investment in the real estate sector. These include tax breaks, streamlined regulatory processes, and the establishment of special economic zones. These initiatives have created a conducive environment for both domestic and foreign investors, driving the growth of the Commercial Real Estate market. In conclusion, the Commercial Real Estate market in Albania is experiencing growth and development due to customer preferences for modern office spaces, the rise of mixed-use developments, and increasing investment in the hospitality sector. The presence of a large diaspora community and favorable macroeconomic factors, such as economic reforms and government incentives, further contribute to the expansion of the market.

Data coverage:

Figures are based on value of commercial real estate.

Modeling approach / Market size:

Market sizes are determined by a bottom-up approach. As a basis for evaluating this market, we use national statistical offices. Next, we use relevant key market indicators and data from country-specific associations such as share of industry, manufacturing, and services of the GPD, price level index, GDP. This data helps us to estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the market, for example, exponential trend smoothing.

Additional Notes:

The market is updated twice per year in case market dynamics change. The impacts of the Russia-Ukraine war are considered at a country-specific level.

This report presents a comprehensive analysis and additional information on the Financial market, in a PDF format.

After a challenging period during the coronavirus pandemic, the European commercial real estate sector now faces additional pressures, including inflation, record-high interest rates, and sluggish economic growth. In 2022, these challenges were evident through contracting investment volumes in the two largest markets—the United Kingdom and Germany. Although the shifting economic landscape has impacted all commercial real estate subsectors, industrial and logistics—a property type that demonstrated incredible resilience during the pandemic—continues to be the most popular investment class. The performance of the sector is closely tied to the state of the economy, explaining why cities with flourishing capital markets garner the most interest from investors. In 2023, investors identified London, Paris, and Madrid as the three most attractive markets.

Growing demand for industrial and logistic real estate is prominent in Europe, driven by the increase in online retail sales rather than in-store. All the Nordic countries saw steady growth in their e-commerce sales during the past fifteen years and more, and the growth is expected to continue. Investments in the industrial and logistic real estate industry have generally been at a higher level during the last few years. The highest investment value among European countries in the first half of 2021 was in the United Kingdom, while Sweden topped the list among the Nordic countries, and was fifth in terms of industrial and logistics investment in real estate in Europe that year.