In 2024, the Ukrainian construction market in monetary terms increased by 6% compared to 2023 and amounted to approximately UAH 170 billion (€3.9 billion).
The main segments for investment in commercial real estate were warehousing and retail facilities. Kyiv and Lviv regions remain the most attractive for the construction of new buildings, as they have a large population and good location relative to major transport routes. In 2024, the total area of new commercial projects increased by 65% compared to 2023. The warehouse segment grew by 111% and the retail segment by 22%.
The vacancy rate in the office real estate market of about 25% has forced developers to slow down or stop the development of new projects in this segment. In Kyiv, most of the new business centers are facilities that were started before the full-scale invasion. In Lviv, despite the increased demand for offices, 75% less new office space was commissioned in 2024 than a year earlier.
In the commercial construction market, the hotel real estate segment showed the highest growth, up 182%. This is primarily due to the active development of resort real estate in western Ukraine.
The restoration and protection of critical infrastructure accounts for about 20% of the construction market.
Demand in the primary residential real estate market increased by 12% in 2024. One of the important factors behind this was the introduction of the eHouse program, which accounted for a third of loans to new buildings.
In 2024, the demand for solar power plants on the roofs of commercial buildings and roofs of private cottages increased significantly.
Between 2019 and 2024, the cost of construction in Ukraine doubled. At the same time, the cost of construction materials and services increased by about 24% over the past year.
There is a growing shortage of skilled construction workers in blue-collar occupations. For some positions, companies have to look for specialists for several months and sometimes train employees themselves.
The shortage of skilled workers and high inflation are forcing employers to raise salaries and introduce new employee loyalty programs. On average, salaries in the construction industry grew by 15% over the year, which also contributed to the growth in construction costs.
Construction companies are actively recruiting pensioners and women to perform work that does not require significant physical activity: construction equipment operators, drivers, welders, etc.
The staff shortage encourages Ukrainian companies to consider hiring construction specialists from Asia and Africa.
On January 1, 2023, the Law of Ukraine “On the Placing of Construction Products on the Market” (EU Regulation 305/2011) came into force, introducing a new market surveillance system to ensure the quality of construction materials. 2025 will be the last year when the old and new regulations will be in force in the construction sector. Starting from 1 January 2026, suppliers of construction products covered by this law will be required to draw up declarations of performance and register them in the Unified State Electronic System in the field of construction.
Starting from August 2024, amendments to the Resolution of the Cabinet of Ministers of Ukraine No. 314 allow foreign companies to construct facilities of consequence class CC2 and CC3 during martial law by submitting a declaration to the licensing authority. This opens up wide opportunities for foreign contractors to implement construction projects in Ukraine, especially those financed by international institutions.
For 2025, the Ministry of Communities and Territories Development of Ukraine has planned to update 7 DBNs and develop 80 standards aimed at implementing processes to optimize design and construction, including BIM technologies, as well as removing barriers to the application of Eurocodes.
Ruukki Energy sandwich panels were used for the construction of the NOVUS Logistics Center, the first BREEAM-certified food logistics complex in Ukraine, the Rauta press service reports.
“Especially for the logistics terminal, Rauta specialists, which is the exclusive importer of Ruukki sandwich panels in Ukraine, have developed a project of enclosing structures with unique nodes that provide maximum airtightness and significant cost savings during the operation of the facility,” said Rauta Director Andriy Ozeychuk.
As reported, in the spring of 2024, Novus Ukraine LLC, which operates the Novus hyper- and supermarket chain, launched the NOVUS Logistics Center in Kyiv, built according to the BREEAM green building principles with loans from the European Bank for Reconstruction and Development. The complex was BREEAM certified at the design stage, and now, after commissioning, the company is preparing the facility to receive the international BREEAM certificate for new buildings, rating Good.
With an area of more than 50 thousand square meters and a height of 15 meters, NOVUS Logistics Center is designed for 5.2 thousand pallet spaces and has 18 temperature zones – from -30 to +24 degrees Celsius.
According to Konstantin Parshin, Head of Operational Logistics at NOVUS, thanks to the use of Ruukki sandwich panels, the temperature inside the main room does not fall below the set 15 degrees in winter and does not rise above 20 degrees in summer.
The release emphasizes that the use of Ruukki Energy sandwich panels ensured the building’s airtightness up to q50 = 0.01 m3/h∙m2 and thermal resistance of structures up to R = 7.47 (m2∙K)/W, which are the best indicators for cold storage warehouses.
Founded in 2014, Rauta Group LLC (Rauta) is an engineering and construction company engaged in the design, supply and installation of sandwich panels, ventilated facades and prefabricated buildings. It is the exclusive importer of commercial products from the Finnish concern Ruukki to Ukraine, as well as the developer of a number of innovations that reduce the cost and time of construction.
CONSTRUCTION, NOVUS, OZEYCHUK, RAUTA, RUUKKI, SANDWICH PANELS
The use of Ukrainian-made sandwich panels increased by 15% in the first half of 2024, while sales of imported products decreased by 12%, Andriy Ozeychuk, director of the engineering and construction company Rauta, told Interfax-Ukraine.
“In the first half of 2024, the volume of the Ukrainian sandwich panel market in absolute terms amounted to just over 1 million square meters, which is similar to the figures for 2023. At the same time, the use of Ukrainian-made panels increased by 15%, while sales of imported products decreased by 12%,” he said.
Ozeychuk also emphasized the change in the structure of sandwich panels: their share of mineral wool is decreasing, while the demand for panels with PIR (polyurethane foam – a fire-resistant insulating material based on polyurethane) filler is growing, which has the highest thermal insulation properties and a lower price.
“From 2021 to 2024, the price in euros of PIR-filled sandwich panels decreased by 18%, while mineral wool-filled panels increased in price by 37%,” he said.
At the same time, the Rauta director stated that today the construction of new facilities is actively developing only in western Ukraine, while in other regions it is limited to spot projects and the reconstruction of destroyed buildings.
According to him, the main problem of the construction market, in particular the sandwich panel segment, is a large market decline of 60-70% compared to 2021. Most investors take a wait-and-see attitude and do not risk investing in new projects.
At the same time, despite the war risks, the owners of most of the destroyed commercial and industrial facilities have invested in their restoration to quickly restart their businesses, allowing them to continue to operate efficiently.
In particular, Rauta has implemented a number of large-scale restoration projects, including the Retroville shopping mall in Kyiv, the production shop of the Chernihiv Automobile Plant, and the Novus supermarket in Bucha (Kyiv region).
According to Ozeychuk, the industry’s acute problems are a shortage of personnel, especially among skilled laborers, as well as blackouts.
“For some positions, we have to look for specialists for several months, and sometimes train employees ourselves. That’s why salaries and, accordingly, the cost of construction are rising. Blackouts, which last from two to six hours a day, reduce the productivity of builders, increase the time and cost of construction by 20-40%,” he said.
According to his observations, the program for the restoration and protection of critical infrastructure facilities has the greatest impact among government programs.
“In general, by the end of 2024, we expect the sandwich panel market to remain at the level of 2023 with a possible growth of up to 10%,” Ozeychuk summarized.
Founded in 2014, Rauta Group LLC (Rauta) is an engineering and construction company engaged in the design, supply and installation of sandwich panels, ventilated facades and prefabricated buildings. It is the exclusive importer of commercial products from the Finnish concern Ruukki to Ukraine, as well as the developer of a number of innovations that reduce the cost and time of construction.
Source: https://interfax.com.ua/
Commercial real estate restoration projects account for up to 20% of Ukraine’s construction market, Andriy Ozeychuk, director of Rauta engineering and construction company, told Interfax-Ukraine.
“Despite the military risks, the owners of most of the destroyed commercial real estate are investing in their restoration to restart their businesses, which allows companies to continue to operate efficiently. In particular, about 80% of commercial facilities destroyed during the full-scale invasion and located far from the war zone have already been rebuilt or are in the process of being rebuilt,” he said.
According to Mr. Ozeychuk, the figure is lower in the segment of industrial and warehouse buildings, at about 40%.
“For most of these facilities, the owners are looking for financing,” explained the Rauta director.
According to him, among the restoration projects Rauta was involved in were the Retroville shopping center (Kyiv), the production shop of the Chernihiv Automobile Plant, and the Novus supermarket in Bucha (Kyiv region).
Rauta’s experience in restoring commercial real estate shows that often an additional requirement of investors during the restoration of facilities is to improve their energy efficiency and architectural attractiveness, which allows them to optimize costs during the operation of buildings.
According to the World Bank, as of February 2024, Ukraine’s reconstruction needs were estimated at $486 billion, of which about 25% were commercial real estate.
Rauta is a leading provider of reliable construction solutions in Ukraine and the European Union.
According to Opendatabot, Rauta Group LLC was registered in Ukraine in 2014. Its authorized capital is UAH 388 thousand, and its revenue for 2022 is UAH 102.396 million.
The engineering and construction company Rauta is starting to implement a business center project in Podil, Kyiv, which will be the first project in which Rauta will perform customer service functions, the company’s press service told Interfax-Ukraine.
“The client service is a new service in Rauta’s offer, but the company already has several projects in its portfolio in which it performs work that allows it to build turnkey buildings,” said Andriy Ozeychuk, the company’s owner.
The functions of the construction customer service include support at the pre-project stage, development of design and estimate documentation, its examination, selection of a general contractor, obtaining a building permit, preparatory work at the construction site, construction of the facility itself, construction and connection of external engineering networks, and commissioning.
Rauta clarified that the business center with an area of about 3 thousand square meters is being built for an international IT company in the historical center of Kyiv, at 10b Kontraktova Square.
Rauta is a leading provider of reliable construction solutions in Ukraine and the European Union.
According to the company’s data, Rauta Group LLC was registered in Ukraine in 2014, with an authorized capital of UAH 388 thousand and revenue of UAH 102 million 396 thousand in 2022.
The construction project management outsourcing is a new service in Rauta offer, but the company already has several projects in its portfolio where it performs turnkey construction works.
The new 7-storey business center has an area of about 3.000 sq.m and modern infrastructure with a comfortable workspace for IT entrepreneurs.
Performance of Rauta construction project management outsourcing includes the following stages:
More information about the construction project management outsourcing
