Investment Shift in Russian Real Estate: Focus Moves from Housing to Commercial Properties
In the first half of 2025, the Russian real estate market experienced a significant shift in investment, with a notable increase in commercial real estate and a decrease in residential development.
Real EstateInvestmentCommercial Real EstateRussiaMarket TrendsReal EstateAug 01, 2025
The study highlighted that the largest increase in investment share was recorded in the office and warehouse segments, which saw increases of six and four percentage points, respectively. The office segment now accounts for 36 percent of investments, while the warehouse segment stands at 24 percent. Investments in hotels increased by three percentage points, accounting for 5 percent of all real estate investments. However, the share of investments in retail remained unchanged at 12 percent.
Despite the increase in the share of commercial facilities, the volume of investments in key segments decreased by 12 percent year-on-year, amounting to 325 billion rubles. Investments in the office segment fell by 10 percent due to a slowdown in economic growth, while the warehouse real estate segment saw a 7 percent decrease due to discrepancies in cost estimates between buyers and sellers. Investments in retail decreased by 28 percent year-on-year.
Irina Ushakova, the senior director and head of the Investment and Capital Markets Department at CORE.XP, explained to Izvestia that high interest rates continue to affect capital sentiment, leading to a 24 percent year-on-year decrease in total investment in real estate. The segment of housing sites saw a significant drop of 49 percent, amounting to 92 billion rubles, due to lower demand resulting from high mortgage rates. However, there was a 44 percent increase in investment in commercial real estate.
Additionally, the share of foreign sellers in the volume of investments in real estate was only 7 percent, a six percentage point decrease from last year. This means that almost all investment activity (93 percent) was generated by Russian sellers, the analysts concluded.
In an interview with Izvestia on July 29, Alexander Volgin, founder of the Lendly investment platform, discussed new instruments for collective investment in Russian real estate. He noted an increasing interest in collective investment in real estate in the Russian Federation, driven by the high cost of facilities. Many investors seek to diversify their portfolios but do not have the opportunity to purchase housing completely.
Overall, the shift in investment from residential to commercial real estate reflects broader economic trends and investor preferences in the Russian market. The continued focus on commercial properties, particularly offices and warehouses, indicates a strategic move towards sectors that are perceived as more stable and profitable in the current economic climate.
Frequently Asked Questions
What is the main trend in Russian real estate investment in 2025?
The main trend is a significant shift in investment from residential to commercial real estate, with a 11 percentage point increase in commercial real estate and a 11 percentage point decrease in residential development.
Which segments saw the largest increase in investment share?
The office and warehouse segments saw the largest increases in investment share, with the office segment increasing by six percentage points and the warehouse segment by four percentage points.
Why did the volume of investments in key segments decrease?
The volume of investments in key segments decreased by 12 percent year-on-year due to a slowdown in economic growth, discrepancies in cost estimates between buyers and sellers, and high interest rates affecting capital sentiment.
What is the role of foreign sellers in the Russian real estate market?
The share of foreign sellers in the volume of investments in real estate was only 7 percent, a six percentage point decrease from last year, indicating that almost all investment activity (93 percent) was generated by Russian sellers.
What new instruments are being introduced for collective investment in Russian real estate?
New instruments for collective investment in Russian real estate are being introduced to cater to the increasing interest from investors who seek to diversify their portfolios but do not have the means to purchase properties individually.
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