The developers decided to freeze their plans for non-residential developments since it seems that crisis in the construction industry has expanded to this sector too. The new CYSTAT data show how hesitant the developers are in constructing new non-residential buildings while the economic environment remains uncertain.

The obscure economic environment in 2009 contributed to the drop in the area of licensed projects for non-residential developments by 18.3%.

The decline is bigger than that for the residential properties, which stood at 14.5%.

“The decline is higher for the residential buildings since the impacts of the crisis on this sector are bigger in relation to the sales”, real estate agent, Elias Danos told StockWatch.

The freezing of non-residential developments is exceptionally obvious in the sector of hotels, where the annual decrease of the area of the licensed projects reached 86% in 2009. This drop is partly attributable to shrinkage of the licenses for tourist villages due to the collapse of external demand for properties.

The licenses for the construction of offices have declined 20% too, mostly due to the lower area of the buildings.

According to Mr. Danos, the crisis and the need to cut the expenses entails smaller office areas.

Despite estimates for bigger yields of the industrial buildings and warehouses, crisis has affected them too. The area of the building permits fell 22%.

The wholesale and retail trade buildings are an exception since the developers’ plans for the construction of super markets and stores were not daunted by the downturn in consumption. Therefore, their licenses recorded an increase of 15%.

As for the residential properties, crisis will continue in 2010 too, since the excessive offer of housing units discourages new construction exposures.

The area for the residential apartment blocks showed an annual decrease of 23% and for the buildings with two housing units 46%

The area in the single houses decreased 4%.

The total drop in the building permits stands at 15%, mostly due to hesitation for the promotion of big projects.

According to Mr. Danos, 2010 will be a difficult year for the construction activity.

 

Source:Stockwatch.com.cy