Train with trucks in Austria

19 Motley Real Estate Ideas in Times of COVID-19 - Part I – “Logistic” Properties

By Helmut Seitz and Nadja Holzer, HSP Rechtsanwälte GmbH

Suddenly everything was different! Shops were closed, schools and offces were empty, people were queuing up in supermarkets, and hotels had more employees than guests. Any other rental income than from housing suddenly was questionable. The pandemic hit the real estate world with disruptive intensity. We were asking ourselves, “What can we do in the world of real estate to overcome this?” We compiled 19 motley ideas. They are structured in asset classes. In this edition we want to start with “logistic” properties. Obviously, logistics like Amazon or Alibaba warehouse can be seen as winners in these times. But there is more beyond these “no-brainers”.

Idea No. 1: 
DRY PORTS

The current pandemic has shown the diffculty of maintaining 100% of the maritime traffc, not least because of the various prohibitions laid down during the pandemic barring ships from docking at ports due to COVID-19 security measures. As a consequence of these measures taken during the pandemic, socalled “dry ports” are becoming increasingly important. Logistic centres inland or in the vicinity of a port provide a way of maintaining the transportation of goods, especially during a crisis. Hastily established dry ports all over the globe show that dry ports are an addition or alternative to classic ports that works. There are currently plans to establish such a dry port in Austria. Fürnitz rail station near Villach will be the central hub in the area inland of the port of Trieste. Trieste is one of the most important ports in the trade between Central and Eastern Europe. In the next years, there will be substantial investment in this infrastructure. Substantial investments mean high demand. Trieste-Fürnitz is only one example of many. Dry ports will sustain future logistics and we think it is a profitable idea to invest in this kind of infrastructure.

Idea No. 2:
RAILROADS

The innovation and chance that lies in investing in dry ports is strongly connected with real estate investment in railroads. The vast majority of US freight railroads, for example, are privately owned. In the US, railroad property or at least property in the vicinity of railroads is widely known as a successful investment, and there is obviously a good reason why big investors like Warren Buffett or Bill Gates have already bought railroad companies and property. This trend will reach the EU sooner or later. Nowadays, railroads can also prove attractive for the upcoming climate policy of the EU, which wants to relocate the focus of transportation on railroads instead of individual transport.

Idea No. 3:
SELF-STORAGE

In 2050, almost 2.2 million people will live in Vienna, which shows the great need for new living space. An apartment does not offer the storage space of a house, so we want you to consider another idea coming from North America, which helps to resolve this issue. Self-storage can be a very attractive investment, as there is demand from both private individuals and companies. Investors can decide whether they want to build only storage containers on a property or entire storage buildings. Europe is only at the beginning in this constantly growing field.

Idea No. 4: 
SAFETY AND SECURITY

The next idea is directly linked to the previous one. The art market is booming, and collectors are looking for safe places to store their treasures. Bank safes are expensive and often do not provide the correct storage conditions for highly fragile works of art. Self-storage can be designed as special storage for extremely valuable objects such as art or vintage cars. To find exciting real estate investments, it is essential to think outside the box.

In times of crisis, there are many new things to discover away from logistical investments, so we would be happy if you followed our ideas. You will find a sequel on this topic in the next issue, so until then, stay tuned!


Helmut Seitz

Helmut Seitz

GGI member firm
HSP Rechtsanwälte GmbH
Law Firm Services
Vienna, Austria
T: +43 1 533 0533
E: This email address is being protected from spambots. You need JavaScript enabled to view it.
W: hsp.law
Nadja Holzer

Nadja Holzer

GGI member firm
HSP Rechtsanwälte GmbH
Law Firm Services
Vienna, Austria
T: +43 1 533 0533
E: This email address is being protected from spambots. You need JavaScript enabled to view it.
W: hsp.law


Publihshed: GGI Insider, No. 110, November 2020 l Photo: Leonid Andronov - stock.adobe.com

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