REAL ESTATE – Investment in Turkey

• FDI inflows in Türkiye increased to USD 13.3 billion, while real estate FDI was USD 5.6 billion, 42.2 percent of total FDI in 2021.

• Urban renewal and mega projects dominate the agenda for the foreseeable future, particularly in Istanbul. Some projects in the city include Marmaray, Yavuz Sultan Selim Bridge, Eurasia Tunnel, and Istanbul Airport. 

• The Urban Renewal and Development initiative will encompass 7.5 million housing units. The initiative has a budget of USD 400 billion, with a large contribution coming from the private sector. 

• The total number of homes sold in the Turkish property market was 1.4 million units in 2021. Sales of real estate to foreigners began to increase following the abolishment of the reciprocity law in 2012. In 2021, a new record was set with the sales of 58,576 homes to foreigners in Türkiye. Regarding home sales to foreigners, Istanbul was the top-performing province with 26,469 sales in 2021, followed by Antalya with 12,384 sales, Ankara with 3,672 sales, and Mersin with 2,513 sales. 

• By 2021 year-end, the existing Grade A office stock in Istanbul surpassed 5.8 million square meters. There is more than 1.6 million square meters of office supply under construction including the Istanbul Finance Center (IFC), and it is expected that the total grade A office supply will reach almost 7.4 million square meters gross leasable area by 2022 year-end.

• 453 shopping centers are operational in Türkiye with a total gross leasable area of 14 million square meters. 134 shopping centers in Istanbul with a total gross leasable area of 5.2 million square meters represent 37 percent of the total leasable shopping center area in Türkiye. 

• Total logistics real estate supply in the Marmara Region, including Istanbul and Kocaeli, is 10.2 million square meters as of 2021 year-end. During 2021, 233,000 square meters of logistics leasing transactions were completed.

Real Estate Investment Opportunities in Turkey:

1. Urban Renewal and Mega Projects in Istanbul: Istanbul is not only a hub of urban renewal and mega projects, such as Marmaray, Yavuz Sultan Selim Bridge, Eurasia Tunnel, and Istanbul Airport, but it is also undergoing extensive urban transformation due to earthquake risks. This presents an opportunity for real estate developers and investors to participate in the revitalization and reconstruction efforts, ensuring safer and more resilient infrastructure for the city.
2. Housing Market: The Turkish property market has seen significant growth, with 1.4 million units sold in 2021. The abolishment of the reciprocity law in 2012 has increased real estate sales to foreigners, reaching a record high of 58,576 homes sold in 2021.
3. Grade A Office Space in Istanbul: Istanbul offers a thriving office market, with over 5.8 million square meters of existing Grade A office stock. With more than 1.6 million square meters of office space under construction, including the Istanbul Finance Center (IFC), the city is expected to reach a total of 7.4 million square meters of grade A office supply by 2022.
4. Shopping Centers: Turkey has 453 operational shopping centers, with a total gross leasable area of 14 million square meters. Istanbul alone accounts for 134 shopping centers, representing 37 percent of the total leasable area in the country.
5. Logistics Real Estate: The Marmara Region, including Istanbul and Kocaeli, offers a significant supply of logistics real estate, totaling 10.2 million square meters. The region presents opportunities for investors interested in logistics facilities and leasing transactions.

Investing in the Turkish real estate market provides access to a dynamic and rapidly growing sector. With its strategic location, large construction sector, and ongoing development projects, Turkey offers attractive prospects for real estate investors looking to capitalize on its expanding commercial and residential market.