Czech Republic’s roadmap towards a carbon-neutral built environment by 2050

The Czech Republic has committed to supporting Europe’s target of achieving carbon neutrality by 2050. In alignment with this goal, the Czech Green Building Council (CZGBC) has introduced a comprehensive Zero Carbon Roadmap. 

This document serves as a foundational guide for attaining a carbon-neutral built environment within the Czech Republic, outlining specific steps and measures necessary to eliminate greenhouse gas emissions from buildings. The CZGBC has already presented the document to the relevant ministries and offered assistance in the implementation of the recommended measures.

Extensive international support

The initiative aligns with the global commitment under the Paris Climate Agreement, signed by 195 countries, including the Czech Republic. Moreover, it supports the European Green Deal, aiming to make Europe a carbon-neutral continent by 2050. Statistical data confirm that without fundamental changes in the construction and buildings sector, achieving decarbonisation is virtually unrealistic.

“Through annual consultations with key stakeholders, barriers to decarbonization in the construction sector have been identified, and corresponding steps to overcome them have been proposed. The CZGBC has engaged with government representatives and offered assistance in implementing the recommended measures,” says Simona Kalvoda, CZGBC Executive Director. The decarbonization roadmap received support from the European Bank for Reconstruction and Development (EBRD), the Taiwan Business EBRD Technical Cooperation Fund, and the World Green Building Council (WorldGBC).

Similar roadmaps have been developed in ten other European countries, including Croatia, Finland, France, Germany, Ireland, Italy, the Netherlands, Poland, Spain, and the United Kingdom.

Key actors in decarbonization

The primary stakeholders in the Czech Republic’s decarbonization efforts include government bodies such as the Ministries of Industry and Trade, Environment, Regional Development, and Finance. Additionally, participants in the construction value chain, financial sector, professional organizations, research institutions, and educational establishments play vital roles. The roadmap provides recommendations for each of these entities.

Categories of Proposed Measures

The proposed measures in the roadmap are categorized into four key areas:

  1. Accelerating Renovations and Implementing Energy Savings 
  2. Reducing Embedded Emissions
  3. Development of Community Energy
  4. Cross-Cutting Measures

Specific Steps for Stakeholders

Individual actors in the decarbonization process are provided with specific steps, including the development of a national strategy for climate protection, engaging the financial sector in renovation efforts, supporting manufacturers in decarbonizing production, and updating technical standards for greater use of natural and recycled materials.

The transition to sustainable energy and green building requires a coordinated approach. While some businesses have taken steps, collaboration and support from state institutions are crucial. The CZGBC has engaged with government representatives and presented the roadmap to ensure favourable conditions for implementation.

The Czech Republic’s commitment to the Zero Carbon Roadmap signifies a proactive stance in contributing to Europe’s carbon-neutral aspirations. The comprehensive approach outlined in the roadmap emphasizes the importance of collaboration among various stakeholders to achieve meaningful and effective decarbonization in the built environment.

Access to the Roadmap

The entire Zero Carbon Roadmap document is available for download on the [Czech Green Building Council’s website](https://www.czgbc.org/cs/zero-carbon-roadmap).

CZGBC.org

Entering the Czech market can be smooth

Founding a new branch or entering the Czech market can represent an insurmountable obstacle for foreign as well as domestic companies.  However, one only needs to find a reliable local partner who can help not only in his area of expertise, but also provide a lot of interesting and useful advice. 

Mgr. Jan Pešl, the Sales Manager of the Brno company Compactive, s. r. o, told us more about it.  

What does Compactive do?

We provide comprehensive services in the field of electrical installations, information and communication technologies. We design and deliver complete solutions for low-current and high-current electrical systems connected by data networks with information, communication and security system and audio and video technology. This is also the origin of our company’s motto: “Harmony in technologies”. 

It means that you are not just consultants for foreign companies that are considering entering the Czech market? 

We certainly are not, but we have direct experience working for foreign clients and we found out that we actually enjoy it and most importantly that we are good at it and have something to offer our customers. I think we understood what a foreign company needs when entering unknown waters.

What is it?

They need a partner who is a professional in his field and who does not only blindly fulfil requirements, but proactively looks for suitable solutions and advises and offers more suitable alternatives.

How did you get to that? 

We have been cooperating in the long term with various developers who approach us for the design and implementation of fitouts for branches of foreign companies. We strive to establish close relationships with our customers, to become their equal partner and not just one of many suppliers. This naturally places high demands on us. Quality comes first for us and we decided that we don’t want to compete for the lowest price in tenders because we don’t like following the statement of materials and assembly blindly without thinking about the work. What is to our advantage is that we communicate in English directly with the project manager and the customer’s IT department. We want to create added value and devise solutions together with the client. This is what makes customers turn to us repeatedly and recommend us to other companies in their area. That is what we are extremely grateful for.

Do you only do electrical installations for foreign clients?  

It usually starts with the electrical installation, but after a few meetings and finding mutual trust, we find out that the client’s needs go far beyond the simple laying of cables. We kind of open up their eyes and broaden their horizons. As a result, our work is very creative and involves a lot of listening as well as making recommendations based on our experience and constant education. After all, the portfolio of our services is quite broad – we deal with high-current and low-current installations, data networks, data centres, building security (camera, access, security or fire systems) as well as audio and video technology. Apart from our field of business, however, we can connect the client with other interesting companies that have a similar mindset and provide, for instance, interior design, furniture, lighting, internet connectivity and VPN. It is a well-functioning ecosystem. Right now, we are completing an order for an American pharmaceutical company, equipping new offices in Prague. The project offers a wide variety of activities, from the installation of structured cabling through coordination with other professions to the configuration of the IT infrastructure in cooperation with the client’s IT specialists on the other side of the globe. The quality of our work and smooth communication made such an impression on the client that he himself told us that he would like to have all branches in the world only handled by ourselves. This is the best image for us.

How do your customers view the cooperation? 

They are certainly grateful for a partner who is local to the Czech market and they don’t have to think about everything by themselves. They gradually build trust in us and, for instance, start consulting us about the next course of action. If we know, we advise, if we don’t, we put them in touch with someone who might know. Moreover, we also offer post-warranty services, so our cooperation continues in the long term. When the premises turn insufficient after some time, we often cooperate on extensions or equipping new premises.

How is the situation with Czech legislation and standards in the field of electricity?

Of course, Czech standards must be observed, no exceptions apply there. Clients are sometimes aware of some basics, but they rather find themselves groping in the dark and thus rely on the representatives of the individual professions who can help them with everything and look after everything. It is all about trust. Naturally, large corporations often have their own standards, but these must be set aside if they are in direct conflict with Czech standards. For instance, when we were implementing the Brno branch of Primark in cooperation with an Irish electrical company, we constantly consulted the client’s internal standards versus Czech standards. Some of their standards set the safety bar high above the legislation, but others were, on the contrary, inadmissible, so we searched for a suitable alternative. And this is something that the customer cannot be prepared for in advance.  

Where do you see the niche when a foreign client enters the Czech market? 

Certainly in the difficulty of finding someone the foreign company can turn to. Ignorance and lack of clarity on how to proceed play a big role. A company coming from abroad usually finds one big partner to cover the entire operation, which is understandable. On the other hand, this increases the risk of not being able to meet all the client’s needs and requirements. Last but not least, there is a problem of a language barrier, because even today, English is still not standard in all companies.

How could the whole process be improved? 

I think both parties would benefit from a platform where they could learn about companies entering the Czech market and about local partners who can help with the entry. If, as a state, we are trying to motivate foreign companies to establish themselves here, we should make the whole process as easy as possible for them, not only from legislative point of view, but also from factual point of view as in practice, things usually don’t go exactly as planned. 

Mgr. Jan Pešl, Sales Manager 

PR

Photo: Compactive archive

 

 

Crestyl has become a regional developer

Originally a Czech developer and investor, Crestyl strengthened their position in the Central European residential real estate market at the end of the year and is working on 70 projects in Central Europe.

In one of the largest real estate transactions in Central and Eastern Europe, they took full control of a major Polish residential developer, Spravia. In the challenging real estate environment, Crestyl has thus expanded their operation in the exceptionally high-performing Polish residential segment. Due to the transaction, Crestyl’s total balance sheet has increased from 850 million to 1.3 billion EUR with the intention of further growth in both the Czech Republic and Poland. Crestyl’s total portfolio now includes 70 projects in Central Europe.

“While the Czech Republic is our home market and we rely heavily on it, Poland is a key part of our future – we want to continue to develop there significantly,” says Omar Koleilat, co-founder and CEO of the Crestyl Group.

Crestyl has been operating in the Czech real estate market for over 20 years and is one of the leading developers with a broad portfolio of residential and commercial projects. In all their projects they focus on quality, design, superior processing, use of first-class materials, and overall comfort for their residents and visitors. Spravia, which Crestyl acquired, is one of the largest developers of residential real estate in Poland. Since 1999, they have already completed 147 projects and their individual stages, building more than 21,500 residential units and premises.

“Crestyl is known for their long-term specialization in mixed-use projects. We want make good use of our experience in this segment and our knowledge of design and architecture in the Polish real estate market and expand Spravia’s scope beyond its traditional residential projects,” adds Simon Johnson, COO of Crestyl Group and its CEO in the Czech Republic. He refers to, for instance, the largest project in the centre of Prague, Savarin, the recently completed DOCK quarter in Prague’s Libeň, or the newly emerging Hagibor quarter near the Želivského underground station in Prague.”

Kamienica przy Kinie – Poznaň

Hagibor

Photo: Crestyl’s Archive

Delta Pods Architects reprezents four principles

Delta Pods Architects reprezents four principles: Ecology, economy, social aspects and design

DELTA is an international provider of real estate services and is represented by approximately 400 employees at several locations in mother country of Austria, then in the Czech Republic, Slovakia and Ukraine. DELTA’s services include architecture, construction management and consulting.

Its subsidiary Delta Pods Architects is an internationally active architecture firm with a transnational, interdisciplinary team with around 160 architects, civil engineers and building technicians. In addition to Austria, there are currently offices in the Czech Republic, Slovakia and Ukraine. In addition to architectural and general planning services, the company also specializes in digital tools (BIM), interior design and local construction supervision. Delta Pods Architects has already realized numerous projects in the following sectors: research, health, production, education, housing and labour. Reference projects include the Elisabethinen Wien Mitte, which was awarded the 2023 monument protection medal, as well as pharmaceutical projects for Boehringer I. and Biomay, among others. The office developed by Delta Pods Architects in Slovakia for Takeda was honoured with the Innovative Office of the Year award in 2023.

Klaus Ransmayr, Chief Design Officer at Delta Pods Architects answered the question od Development News.

 

The DELTA Group established a new brand of Delta Pods Architects at the turn of the year. What can clients expect?

We are a team of architects, technicians and planners who work together for common values and goals: A sustainable future for all and enhancing the quality of life through a responsible building culture. The architecture of Delta Pods Architects is the expression of a basic attitude. We align our position with four principles: Ecology, economy, social aspects and design. Therefore, we always research the latest technology and listen carefully to the needs of our clients and future users. Our solutions are versatile in their use, attractive in their design, and sustainable in their materials. As a result, they outlast the life cycle of entire generations.

BOX

Klaus Ransmayr, CDO, Delta Pods Architects, is an internationally educated architect and creative based in Vienna with substantial experience in conceptual design, schematic design and design development of office, mixed-use, commercial, residential, industrial, and other complex and award-winning developments. For Delta Pods Architects, he is responsible for leading the design for all projects in design and planning phase and a key person in the management team for business development and acquisition. As CDO, Klaus Ransmayr holds the leadership role in guiding projects from the initiation through the design, ensuring continuity of design intent and quality through the planning and execution up until the delivery of the project. In this role, he represents the company towards stakeholders and carries the responsibility for design as well as strategic and commercial decisions. His substantial technical, commercial knowledge and experience, and the ability to guide the project teams through the entire design process, have helped and allowed him to deliver numerous projects successfully. Previous to his position at Delta Pods Architects, Klaus has worked as partner and Design Director at HENN as well as Asymptote Architecture and Coop Himmelb(l)au.

What are your goals? What will be this international team of architects specialized in?

We strongly believe that architects have a responsibility to shape the world to the better. For us, our slogan ‘Beyond Building’ means creating worlds, not just buildings. We think of them in the contexts of environment and surroundings, architecture and technology, design and usage, footprint and life circle. This claim is complex and multidimensional. We meet this challenge with precise solutions. Our services range from architecture, interior design, general planning to local construction supervision/management. We are pioneers in using digital tools and BIM and see sustainability consulting as one of our core-strengths. We see architecture as a communicative process with a high level of social responsibility, too. We plan and design sustainable buildings and are convinced that we are building a better world together. The user, the client and all other parties involved in the planning process are intensively involved in the development of the concept. Thus, we accompany our clients from the first idea to the complete implementation of the project.

Why did you start Delta Pods Architects just now? Is there any special reason for such timing?

The DELTA Group was founded 47 years ago, always having architecture as one of its core-businesses. Throughout the years, each branch developed an independent architectural department. Over the last years we noticed that projects get more and more complex and the demand to involve a large number of specialists is ever increasing. For this we see it as a big potential to combine all our international experience and expertise to be able to best serve those demands. We are now able to react a lot more agile to local resource requirements and are always able to find the best people for the job within our company. 

You were appointed as a head of the team; what are your visions for the future and what do you want to achieve together?

The future of architecture is a vibrant and evolving field, shaped by a combination of technological advancements, environmental concerns and changing human needs. I’m a very passionate architect with a strong believe in the potential of architecture’s impact on society. The future holds endless possibilities for innovation, creativity, and positive impact. My vision for the future of Delta Pods Architects is not just about buildings, but creating spaces that enhance the quality of life, foster sustainable living and inspire future generations. 

Dynamically developing new technologies are increasingly entering to construction technologies. But I am afraid, that this trend is not at the same level not in all the countries. How do you want to work with an affordable offer in different states?

Delta Pods Architects is working globally but acting locally. This means we totally understand that there are alternating standards and also expectations in different countries. We have a strong focus on maintaining the architectural quality independent of where the project is being realized. This is only possible with a strong local presence. 

What possibilities or chances for modernization do you see in the Czech Republic? DELTA has implemented top projects here, so how do you want to follow the successful ones?

The Czech Republic has seen some very high-level ambitious projects recently. We are extremely happy about this development and hope, that this trend continuous and that we will continue to contribute to this in the future. We have strengthened our team focusing on early-stage design and conceptualization as well as sustainability consulting. In Austria sustainability in architecture transitioned from a ‘nice to have’ to a ‘must have’. We hope that this will also be increasingly demanded in the Czech Republic.

What was the first important task you decided to do?

The DELTA Group has a very strong team with focus on later design phases. Therefore, one of the first things we as Delta Pods Architects decided to do was to strengthen the conceptual and schematic design phase. We installed a design department at our Vienna office being responsible for overseeing the design for all projects. The synergy of our teams makes it easier for us to achieve maximum architectural quality in our projects at an international level. There is such a vast number of realised projects within the DELTA Group. Getting an overview of what has been done and making this accessible to everyone within the company was also one of the first tasks we started. This is key to understanding the level of experience and expertise not only internal but also external.

PR Marcela Kolářová a Arnošt Wagner

Photo: Delta’s Archive

Industry leaders are marked out by efficient and sustainable warehouse operations

Although the development of the real estate market in the Czech Republic has been turbulent in recent years, one long-term factor has persisted: record high occupancy of logistics properties in desirable locations, accompanied by a limited supply of land for further development. 

At the same time, customer demand for space adding value beyond four walls and a roof is steadily growing. Whether it’s a new development or operations under an existing lease, they require warehouse space that can be used to its maximum potential, with an emphasis on economy and sustainability.

A range of solutions in one place

Prologis, a global leader in logistics real estate, recently introduced a unique service called Prologis Essentials. This centralized platform can be used by customers in logistics buildings for the convenient purchasing of warehouse equipment and advanced solutions directly from Prologis. These include handling equipment, racking systems, security features, automation elements, robots, and a wide range of other useful amenities, with installation and maintenance provided by Prologis through a proven network of partners. In a standard scenario, the customer would have to source and purchase such solutions themselves, making a significant impact on their costs and the speed of setting up their warehouse operations.

“We have been operating in the global market for 40 years, and during that time, we have gained a wealth of knowledge about our customers’ needs. We have now translated this knowledge into a practical platform. We know what logistics warehouse customers want, and the challenges they typically experience, so we’re committed to meeting their needs and enabling them to operate as efficiently as possible. In addition, the scale of our business allows us to offer very competitive pricing for the implementation of these solutions,” explains Vojtěch Štěpnička, Prologis Essentials Solutions Manager for the Czech Republic.

Energy savings are key

The Essentials Solutions range is divided into four categories: operations, energy and sustainability, electromobility, and workforce. These topics are increasingly at the forefront of customers’ minds, and the Prologis Essentials platform aims to help them optimize their businesses in these areas by innovating in a cost-effective and environmentally-friendly way. 

“On the Czech market, we see that energy-efficient solutions are increasingly in-demand. We take a multi-faceted approach to this; firstly, we take full account of energy developments in the region when designing new buildings. For example, the recently completed speculative construction of two new distribution centres at Prologis Park Prague-D1 Ostředek created spaces that are completely independent of gas, and that feature high-quality LED lighting with motion sensors or heat pumps as standard. Secondly, for customers in our older buildings, we can explore and tailor solutions to increase energy efficiency in their operations through Prologis Essentials,” says Vojtěch Štěpnička. Prologis already offers customers the option of installing electric car charging infrastructure to support electromobility, while in the near future, the company intends to implement a pilot project in the Czech Republic for the construction of solar power plants in its parks.

Tailored financing

Products and services available through the Prologis Essentials platform are suitable for every type of business at any stage of operations, from those just getting to work in a new warehouse, to those looking to reconfigure or expand their premises or move to a new location, with options available to suit a wide of range of activities. As such, Prologis offers an equally wide variety of financing options: rental, operating lease, purchase, or in the case of older racking systems, buy-back. The Essentials platform is also unique in that its solutions are available to all logistics customers, regardless of whether or not they are based in a Prologis building. “Deferring investment can save costs in the short term, but we know from experience that industry leaders tend to excel in creating superior operational efficiency. The pressure to increase efficiency will gradually drive logistics real estate users to invest in automation, and the Essentials platform offers the ideal tools to benefit from these changes without incurring high upfront costs,” concludes Vojtěch Štěpnička.

Green leases will be common by 2026.

Savills prepared “ESG Top 10” to guide companies through the process of setting the successful strategy.

Currently, sustainability and ESG responsibility are not being addressed only in real estate, it affects virtually every company. Savills’ “Sustainability Report” says that by 2026, green leases will become a common part of lease agreements. Absolutely key to the implementation of an ESG strategy will be the cooperation between tenant and landlord, and the setting up of ESG reporting. Reporting of non-financial data is required by EU legislation and data from the sustainability report will be mandatory from 2024.

For better orientation, Savills has prepared the ESG Top 10 to guide companies through the necessary terminology to successfully ESG strategy.

Pavel Novák, Head of Office Agency at Savills, says: “A key aspect of green leases is the cooperation between landlord and tenant, and the agreement to operate the building in a sustainable manner. However, for a real positive impact on the environment and society, a change in attitude and mindset is essential for an ESG strategy to have an effect.”

 

Jan Jurčíček, Head of Building and Project Consultancy at Savills, adds: “Partial inefficiencies of heating, cooling and air conditioning systems caused by inappropriate regulation is currently one of the biggest problems of building energy performance. At the same time, it is very common for one part of a building to be heated and another to have the sun shining all day and cooling, creating the potential for more efficient building operation in the future.” 

Some of the buildings are generally ESG-ready, but landlords do not have the right processes in place. They have the data they need, but they don’t know how to provide relevant reporting to tenants.

PR

Obermeyer Helika envisages the further development of shopping centres

In our interview with Jiří Fousek, Managing Director of OBERMEYER HELIKA, we take a look into the world of comprehensive planning services. 

With a portfolio including medical buildings, shopping centres, residential complexes, office buildings, and other types of real estate, this company is one of the largest planning and construction consulting firms in the Czech Republic.

What is the key area you are currently working on for Obermeyer Helika? It is well known that you cover almost all segments of the development and construction industry in planning and designing buildings, but what is the main thing for you?

Commercial development is still the most interesting area for us. We believe in further development and are also counting on completing or redeveloping a number of shopping centres. Planning work in this sector is still our core business. This is what we do best on the Czech market, and from my point of view, this is still a very promising segment, although many have doubts about that.

It is said that enough shopping centres have already been built in this country and that we rank very high in the European statistics in terms of square metres of retail space per capita. So where do you see the potential?

I think we’re still facing another major transformation in the development of shopping centres. By that, I mean that poor and unsuccessful shopping centres will gradually disappear, or at least get smaller. Successful and well-planned shopping centres, on the other hand, will grow and will be expanded and rebuilt. That’s my current view of the market. I don’t deny that there’s a lot of commercial space in statistical terms, but we’re at a stage where quality projects will be promoted at the expense of poor ones. And we as a company want to be in on those quality projects and I believe we will be.

What will this development look like from a regional perspective? Are we now talking about building shopping centres exclusively in large cities, or in medium-sized or small towns?

We are seeing that demand for the expansion of shopping centres is still the highest in Prague. It is no secret that this is true of the Centrum Černý most shopping complex, for example, which is to be further improved, something we are currently addressing at Obermeyer Helika. But we also have other locations in Prague where we’re working to reconstruct or at least upgrade existing shopping centres. One example of this is our involvement in the reconstruction of the Palladium shopping centre in the centre of Prague. A similar process will take place in the regions. We have cities where there are now two or three shopping centres competing with each other. Most of the time one of them starts to dominate and the other declines. Naturally, the owners and investors of those successful shopping centres will want to confirm their dominance. Or, on the other hand, investors who have acquired less successful shopping centres will want to change this situation – and that means upgrading. Of course, this all depends on what kind of customers they have, what they can offer them. But the plan is primarily related to the location and design of the shopping centre and, last but not least, how the shopping centre is run.

Moving away from retail centres and looking at your industry as a whole. What do you consider to be the main complication or obstacle to the development of Czech real estate development?

This is a bit of an old chestnut, so I may be repeating myself somewhat. The inflexible nature of our permit processes and planning principles is a hindrance not only to development and construction. It is already a significant drag on the whole economy, on our country as a whole. I could give a number of examples. We can ask: What about the Prague Metropolitan Plan? No one knows at the moment, no one can answer that. Yet it’s been going on for many years. With the new Building Act, we were all looking forward to the situation finally changing, but so far it doesn’t look like it will. One key change was to be the digitization of all the building approval processes. This change is clearly not ready. Yet the act should enter into force on 1st July, 2024, and digitization is not even in its infancy. We don’t have any regulations or ordinances. This means that no one involved in the process knows what will actually happen on 1st July. Unfortunately, I’m afraid that the main objectives of simplifying and speeding up the process will not be achieved by this new Building Act.

From what you say, it’s quite obvious what you’d like to see in the Czech real estate development sector in the near future.

I’d still like us to have good spatial planning, clearer regulation and a Building Act that is fit for purpose. This is what is currently holding us all back the most. Solving or at least improving this legal framework would significantly help the entire Czech economy.

PR

InterCora has already been in the market for 30 years

Companies and business in general are thriving in the West Bohemian metropolis of Pilsen with its population of just over 181,000 people. Apart from the local breweries that export the golden nectar to almost the whole world, there are other companies with a long tradition that are competitive even beyond the borders of the Czech Republic. 

With regard to the development field, these undoubtedly also include the Czech-Bavarian company InterCora, which builds and rents commercial real estate for retail, and has recently celebrated their 30th founding anniversary. During this period, they built over 100 shopping centres with a total area of over 2 million sq m, some of which they manage and operate. 

Restored shopping centre

And what did such a decadal anniversary celebration look like? On Thursday, 9th November, InterCora festively presented the new look of the Alice shopping centre in the Skvrňany district of Pilsen. The entire project corresponds with current trends and meets the strict ecological criteria imposed on new buildings. The shopping centre was built on the site of the former Jednota housing estate building from the 80s. The whole construction of the Alice shopping centre was very fast. Demolition works started only this January – Penny Market closed on 4th January, 2023.

The new centre with an area of 2,500 sq m was inaugurated by representatives of the developer and companies collaborating on the construction as well as the current tenants. At the beginning, both owners of InterCora thanked everyone who participated in the company’s success – employees and business partners, as well as city administrations.

Ing. Ivan Hlaváček, who makes up, together with Dr. Günther Zembsch, the tandem of owners of the InterCora Group, told Development News: “We managed to establish an internal strategy – to demolish buildings that are not functional and are energetically disadvantageous. We decided that building a brand-new building was better than rebuilding or renovating and trying to bring in improvements.” That it was the right decision was stated by the Mayor of the municipal district of Plzeň 3, Mgr. David Procházka, who praised the good cooperation between the developer and the city on the project. Ing. Ivan Hlaváček subsequently added that the area around the building still awaits final completion: “Collaboration with the city of Pilsen proves a very good cooperation, as we left the adjacent plots to the city, but brought them into a state when they are prepared for a completion of a park, which is to be opened next year.”

The main tenant – the Penny Market store and the MÚÚÚ butcher’s shop – were retained in the new shopping centre. The original tenants were then joined by TEDI, Pepco, SUPER ZOO, Devětsil pharmacy and TABAKRA tobacco. 

The celebrations included a conference and a theatre performance 

After the inauguration of the new centre, the guests moved to the Vienna House Easy Plzeň hotel for a conference which InterCora has recently been organizing on annual basis, this time held under the auspices of the Mayor of Pilsen, Mgr. Roman Zarzycký. This year’s main topic was entitled Transformation of a Trader in the Age of Data. The engaging introductory presentation was delivered by Dr. Günther Zembsch, who has been involved in the field of development for over 40 years, and also acts as an analyst and a successful visionary of new concepts. The conference culminated in an economic analysis presented by Ing. Miroslav Singer, former Governor of the Czech National Bank.

However, the celebrations did not end with the conclusion of the official part of the conference; they continued with an evening cultural programme held at the New Stage of the Josef Kajetán Tyl Theatre, providing the guests with the opportunity to watch the musical Candide by Leonard Bernstein. 

Arnošt Wagner, Photo: Author and InterCora’s archive 

We asked both CEOs of  InterCora:

What did you, as investors, consider to be the biggest obstacle in the implementing of the project?

Answered by Dr. Günther Zembsch: Definitely the location of the object, including parking spaces in the existing residential development, so, it was necessary to take into account the issues of the surrounding area. On the one hand, in terms of the number of parking spaces, and at the same time, it was necessary to create a cultural environment in the middle of a localized zone with an area of 2.500 m², where a new city park should be created. This will naturally connect to retail and a restaurant, which should transition into a park with a children’s playground and another network of urban fixtures and fittings, benches, etc. So, there will gradually be a nice living area for the residents there.

What was the main reason when considering whether to reconstruct the original building or demolish it and build a completely new shopping centre?

Answered by Ing. Ivan Hlaváček: It was decided mainly on account of economic aspects and calculations. We drew up a proposal with a building and zoning permit. Of course, we carefully considered and compared various options. In the end, we came to the conclusion that the complete demolition of the building, which was eventually done, and the construction of a completely new centre was a more economical and time-efficient option than pursuing some kind of revitalization, which would have involved a number of compromises – and the new Alice centre would still not have reached the required standard. The economy of the new operation is multiply better than it would have been with the best possible effort to revitalize the original building. So, this great advantage was preceded by the right decision. 

Next year will be a little better

Raiffeisen – Leasing has been operating on the Czech market for almost 30 years and provides a comprehensive range of financial products for financing movables and real estate, including additional services such as insurance and consultations related to subsidies.

The company specializes in financing investment needs in the field of machinery, equipment, technology, vehicles and real estate. The company employs specialists in financing aircraft, locomotives and other specific commodities. It offers a wide range of services to small entrepreneurs, businesses and corporate clients. For private individuals, the company finances cars and commercial vehicles. Alois Lanegger, former executive Managing Director of Raiffeisen – Leasing, answered Development News’ questions.

How does the current situation in the banking sector reflect in the real estate market?

While in general it can be said that the banking market looks good, the situation on the real estate market, which carries specific risks, is more complicated. Interest rates are still high, although they have already fallen slightly, the mortgage market is better off than a year ago, and the volume of mortgages granted is growing year on year. House prices and construction prices remain high and the whole construction market is forecast to decline next year, albeit not significantly. These are the reasons why banks and other financial institutions currently see the property market as somewhat risky. This is why we have to have higher collateral for the properties we finance, which may not always be entirely easy for our clients to accept.

Does this mean that developers are now waiting?

Developers are waiting and it is logical, it is caused by a decline in interest from buyers, high interest rates, high property prices and rising costs incurred for construction work, materials, energy. As a result of the current situation, many developers have already suspended some projects last year. They will start selling again when they complete the projects, i.e. when they have controlled the total cost of the project, in some cases they are waiting for a recovery of demand in the area.

According to the recent developments, it seems the market prefers rentals.

Rental yields have been relatively low in the past compared to sales yields. Leases were less attractive for developers, so they were more likely to sell their projects.  Now that rents are rising, also due to inflation clauses in most lease agreements, rental yields can be expected to match those from sales in the future.

Renting is a long-term investment for the developer…

Yes and no. Leasing will become increasingly lucrative, adequately matching the profitability and potential of each project.  If the developer decides to change its strategy in the future, they can sell the leased apartments later or put them into an investment fund.

Isn’t our rental legislation somewhat inadequate?

Rental legislation is certainly moving in the right direction, albeit slowly. If I compare the situation in the Czech Republic to the situation in, for example, Germany or Austria, the situation there is more complicated for landlords than here. Landlords there, for example, are in a more difficult position when they need to get non-paying tenants out of the rented property. There are certain tools for these situations, but it is a long way. Here, landlords are better protected.

What is the current mix of commodities that Raiffeisen – Leasing has in its portfolio?

Real estate makes up roughly 30–40% of our total portfolio. Of the ‘remaining’ majority, machinery, equipment and means of transport are the most important. We mainly finance trucks, trains, aircraft or production machinery and various technologies. Of course, financing cars is also important to us, and we mostly finance them for our clients in the form of a loan. Generally speaking, car financing is one of the more profitable products for leasing companies. Cars, commercial vehicles and trucks account for around 30% of our portfolio.

And the traditional question: What development do you forecast?

Personally, I think next year will be a little better than this year. Inflation is falling and interest rates will fall with it, and ČNB has also announced that if there is no extraordinary event, then interest rates will go down. With this, I expect that interest in mortgages will rise. People simply need a place to live and therefore have to deal with housing investments. I anticipate that companies that are cautious about new investments will also need to continue to invest.

Arnošt Wagner

Photo: Raiffesen – Leasing Archive

Digitization is an essential part of the successful decarbonization of the building sector

The Czech Republic is only at the very beginning in terms of the digitization of the building industry. The sector is actually one of the least digitized local industries. At the same time, digitization is one of the key prerequisites for the decarbonization of the building industry. 

Without fundamental changes in the sector, achieving the decarbonization goal of making Europe the first zero-emission continent by 2050 is virtually unrealistic. 

Printed documents still lead

“Decarbonization can be perceived as a cross-cutting phenomenon based primarily on detailed and correct measurement of the carbon intensity of most areas of human activity and its subsequent management using both behavioural, legislative and, above all, economic tools,” says Simona Kalvoda, Executive Director of the Czech Green Building Council. Digitization in the building industry will save time and costs and lead to better building management. But the main benefit is that it allows making decisions based on data, not impressions. This is the most important thing for setting up decarbonisation measures and financing them. 

However, the vast majority of information are still used in printed forms, which are impractical for subsequent use or archiving, and in addition, the individual agendas are still not interconnected and work separately. To achieve an optimal state, it is necessary to interconnect number of agendas and to introduce a unified data platform, which should record all the necessary parameters of existing buildings. The platform should enable digital receipt of data on new construction plans and changes in general and provide a data interface for the needs of financial administration, legislation, social affairs, statistics and modelling in a defined standard.

“Bringing together platforms as part of digitization could lead to a simpler and more accurate calculation of a building carbon footprint and the impact of building renovation and modernization on this carbon footprint. This could create an easy-to-use evaluation parameter for selecting the optimal solution, which could also be used in the procurement of contracts in the form of Performance Design & Build. The procurement process itself would also be helped by a higher level of digitization,” says David Martinek, Public Affairs Manager at ČEZ ESCO.

Unnecessary duplications

The absence of a unified platform leads to duplications such as dedicated software for the collection of property tax, the building’s own database of energy labels, the separate development of smart metering solutions, i.e. smart management of the decentralized electricity network or the census of inhabitants, houses and apartments. Another fundamental problem is that existing government systems do not consider the use of state-of-the-art technologies such as decentralized database or artificial intelligence for analysis, management and modelling. 

The BIM method has been used in the Czech Republic for several years. It is about transferring all relevant information about the building into the digital environment and sharing it across the entire life cycle of the building and all stakeholders. “The principles of digital modelling and planning are beneficial throughout the entire life cycle of a building. For building owners and operators, the BIM model is or will be used in the future not only for the design and construction of buildings, but also for the efficient operation of buildings, related to the maintenance and service of individual building elements, which will help decarbonization while considering energy efficiency,” says Petra Hajná, Sustainability Officer at CPI.

Unfortunately, the BIM method is not yet a standard in the Czech Republic. “Standardization or even a law that would require BIM or the principles of sustainable design and operation of buildings is noticeably lacking. In France, for example, the RE2020 law is in force, which requires all projects that apply for a building permit to be designed with a carbon footprint in mind. The state creates pressure, and the market is looking for solutions, which serves as an accelerator,” says Jakub Škaloud, Project Manager at VCES. Jakub Benda, spokesman for Saint Gobain, adds: “As far as BIM is concerned, we have been talking for a long time about the need for state involvement, both in the requirements for our own projects and in the form of rules and methodology.”

The Czech Green Building Council is aware of the importance of digitization for successful decarbonization. In connection with the creation of the Zero Carbon Roadmap, which lists the digitization of the building industry as one of the decarbonization measures, the Council is ready to exert pressure at the government level to accelerate its implementation. 

Architect drawing with cad software designing building

CZGBC.org