With tough times ahead for the land and property industry in general, it is encouraging to hear of one particular segment that is receiving high levels of demand; namely large land sites in emerging markets with full planning permissions.

Why?  A number of large multinationals are looking for sites in emerging markets to establish market share.  In countries like Bulgaria, there is a general lack of major companies, but this is changing.  In particular, energy companies are interested in sites with strong potential for renewable energy production like solar farms and wind turbines.

Why is full planning permission so important rather than standard agricultural land?  As anyone who has tried to get planning permission in emerging markets will testify, it is not easy; emerging markets have emerging processes by definition!  Multinationals do not want the hassle of going through the planning process and the time factor, which can take a year or more, and in many cases do not have the local expertise to push the process along.  As a result, they are happy to pay the extra for a ‘ready-to-go’ site.  In general, land in emerging markets is much cheaper than established markets so the price is worth paying. Locations that are strategic by nature vary due to the buyer’s sector, but for example, logistics companies look at land near highways or new bridge projects.

So who can benefit from this?  Well, developers for one or anyone holding large sites with full planning permission.  A number will have bought multiple tracts of agricultural land with the intention of building.  The current situation means a number of future projects are either on hold or have been cancelled.  Therefore strong demand from multinationals could offer landowners with strategic sites a credible exit strategy in hard times.