Business news from Ukraine

OFFICE SUPPLY IN LVIV DOUBLES IN 2 YEARS

The new supply of offices in Lviv to be commissioned in 2019-2021 will be 176,100 square meters, which is almost comparable to the current offer, UTG consulting company (Kyiv) has told Interfax-Ukraine. “By mid-2019, the growing demand for office space, triggered mainly by favorable conditions for the development of the IT sector, led to a shortage of quality space in the market and, as a consequence, to a decrease in vacancy to 2.2%, an increase in rental rates and a surge in developer activity,” UTG analyst Oksana Havrylevych said.
According to her, office premises with a leased area of 56,400 square meters are expected to be commissioned in 2019 (33.6% of A class, 66.4% of B class), 31,500 square meters in 2020, and 88,200 square meters in 2021.
“With the timely commissioning of the declared facilities by the end of 2021, the total leased office space will be about 378,000 square meters, which corresponds to 500.8 square meters per 1,000 citizens, which may bring the Lviv office market to the phase of oversupply,” she said.

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OFFICE SUPPLY IN LVIV COULD DOUBLE IN TWO YEARS – EXPERT

The new supply of offices in Lviv to be commissioned in 2019-2021 will be 176,100 square meters, which is almost comparable to the current offer, UTG consulting company (Kyiv) has told Interfax-Ukraine. “By mid-2019, the growing demand for office space, triggered mainly by favorable conditions for the development of the IT sector, led to a shortage of quality space in the market and, as a consequence, to a decrease in vacancy to 2.2%, an increase in rental rates and a surge in developer activity,” UTG analyst Oksana Havrylevych said.
According to her, office premises with a leased area of 56,400 square meters are expected to be commissioned in 2019 (33.6% of A class, 66.4% of B class), 31,500 square meters in 2020, and 88,200 square meters in 2021.
“With the timely commissioning of the declared facilities by the end of 2021, the total leased office space will be about 378,000 square meters, which corresponds to 500.8 square meters per 1,000 citizens, which may bring the Lviv office market to the phase of oversupply,” she said.

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ITALY’S ERNEST AIRLINES TO OPEN OFFICE IN KYIV AND PLANS TO INVEST EUR 100 MLN IN UKRAINE

Italy’s Ernest Airlines to open office in Kyiv and plans to invest EUR 100 mln in Ukraine
KYIV. June 19 (Interfax-Ukraine) – Italy’s Ernest Airlines will open its office in Kyiv this summer, and in 2020 plans to place two planes in Kyiv, according to a posting on the website of the Sikorsky Kyiv International Airport. As the airport press service said, Ernest Airlines has already invested more than EUR 30 million in the Ukrainian market over the past two years, and plans to invest more than EUR 100 million in the next two years.
“In 2020, it is also planned to place two aircraft in Kyiv. This will give even more opportunities for work to even more people in Ukraine,” the airport said.
According to the airport, Ernest Airlines services 13 destinations from Ukraine to Italy. In 2018, the airline transported more than 200,000 Ukrainian passengers, and in 2019 it is planned that the number of passengers from Italy to Ukraine and back will exceed 500,000 passengers.
“This year, Ernest will open a call center in Ukraine to attract even more Ukrainian operators who will be able to more effectively help all its passengers. Ernest also employs more and more crew members who speak Ukrainian to have such specialists on all their flights,” the airport said.
In addition, Ernest Airlines already has a special call center in Italy with Ukrainian-speaking employees.
Ernest Airlines is an Italian airline headquartered in Milan. The main operations center of the company is located in Tirana (Albania). The airline is a low cost carrier and serves the Italian and Albanian markets. The airline flies from Kyiv to Rome, Milan (Bergamo and Malpensa), Naples, Bologna and Genoa, and also from Lviv to Rome, Milan (Bergamo), Naples and Venice; from Kharkiv to Rome and Milan (Malpensa), and from Odesa – only to Rome.

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SHARE OF VACANT SPACE ON OFFICE REAL ESTATE MARKET IN KYIV FALLS BY 0.4% POINTS

The share of vacant space on the office real estate market in Kyiv in the first quarter of 2019 fell by 0.4 percentage points (p.p.), reaching 7.2%, the press service of Jones Lang LaSalle (JLL) in Ukraine has reported. “We expect a further decline in vacancy, although not significant. On the one hand, the low commissioning volume that has been observed on the market since 2015 and steady demand contribute to the absorption of space in existing buildings, on the other hand, rising rental rates restrain the activity of tenants,” Head of office Group at JLL, Alexandra Globina said.
The highest rental rates in class A facilities in the first quarter of 2019 increased 6%, to $32 per sq. m. a month, which corresponds to the value of five years ago, according to JLL. At the same time, rental rates in class B facilities also increased to $25 per sq. m. a month.
According to JLL, a decrease in vacancy and an increase in rental rates have led to a gradual increase in developer activity.
The total volume of transactions in the office real estate market in Kyiv in the first quarter of 2019 amounted to 22,500 square meters, with about half of the transactions accounted for IT-companies, JLL experts said.

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AGRICULTURAL HOLDING MRIYA CLOSES OFFICE IN KYIV

Mriya agricultural holding is closing its office in Kyiv, employees are being transferred to offices in Ternopil and Lviv for boosting production effectiveness, the company’s press service has reported. “In connection with the successful completion of the debt restructuring process, Mriya no longer needs a representative office in Kyiv. Now the company is negotiating with employees about the possibility of moving them to a permanent place of employment in the offices in Ternopil and Lviv,” the agricultural holding said .
The company said that the main task for next year is to increase production efficiency and work directly at the location of assets, which will allow employees to respond quickly to challenges and get involved as much as possible in the production process.
Mriya is a vertically integrated agribusiness holding, founded by Ivan Huta in 1992. Today, its land bank is 165,000 ha. The capacities of the holding’s grain storage facilities are estimated at 380,000 tonnes.

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SINGAPORE’S TRADING COMPANY AGROCORP OPENS OFFICE IN UKRAINE

Singapore’s Agrocorp has opened its office in Ukraine, according to information from the public register of companies and individual entrepreneurs. The Ukrainian subsidiary was registered on October 17, 2018. The owner of the company is Agrocorp International PTE Ltd. (Singapore). The director of the newly created company is Yuriy Klympush. The charter capital is UAH 698,200.
According to information on the website, Agrocorp International was founded in 1990. Its core business is trade with crops, in particular, wheat, rice, oilseeds, sugar, cotton and nuts, and their processing.
The company has 22 representative offices in 22 countries and trades in over 30 countries.
Agrocorp started its processing business in 2012 in Canada, currently has eight plants in four countries, with a total capacity of 700,000 tonnes.

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