Construction & Real Estate
From The Report: Turkey 2013
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The construction sector is riding high on the back of a raft of major infrastructure projects, particularly in road and bridge development, and an ongoing urban regeneration plan that will see one-third of the country’s houses torn down and rebuilt. After shrinking in 2009 as the result of a financial crisis, the sector helped lead the economic recovery by growing by 18.3% and 11.5% in 2010 and 2011. Although the market is still susceptible to a temporary slowdown in light of the recent global economic crisis, which moderated growth for 2012, long-term trends favour continued growth. The coming challenge will be to align public and private incentives and ensure that haphazard planning does not derail a promising decade.
This chapter contains interviews with Başar Arıoğlu, Managing Director, Yapı Merkezi, and Ahmet Haluk Karabel, President, Housing Development Administration of Turkey, as well as a viewpoint from Mehmet Ali Neyzi, CEO, STFA.

Articles from this Chapter

Overview

Thinking big: Large projects are on the horizon, but consumer confidence has yet to show significant improvement
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The construction sector is riding high on the strength of major infrastructure projects, particularly in road and bridge development, and an ongoing urban regeneration plan that will see one-third of the country’s houses torn down and rebuilt. Although the market is still susceptible to a temporary slowdown in light of the recent global economic crisis, which moderated growth for 2012, long-term trends favour strong and steady growth. And while the nation’s economic heart, Istanbul, is home…

Interview

OBG talks to Ahmet Haluk Karabel, President, Housing Development Administration of Turkey (TOK‹)
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Interview: Ahmet Haluk Karabel How many housing units will Turkey have to produce to meet economic and population growth? AHMET HALUK KARABEL: It is estimated that there are currently 20m houses in Turkey. Roughly 500,000-600,000 more homes need to be built to accommodate annual population growth, though it should be noted that Turkey’s population growth rate is gradually decreasing. Over the past decade, the share of private sector housing development increased to between 81% and 87%, up significantly…

Viewpoint

Mehmet Ali Neyzi, CEO, STFA, on the history of the sector
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When the Republic of Turkey emerged from the ashes of the Ottoman Empire 90 years ago, the fledgling nation had little indigenous industrial capacity. This was especially clear in the construction sector, which was dominated by foreign firms. Things began to change during the Cold War climate of the 1950s, when Turkey began receiving more development assistance from the US and the international community. This support enabled rapid domestic infrastructure development, and led to an influx of technology…

Analysis

Urban transformation: Taking steps to prepare for an earthquake
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The urban centres of Istanbul and many secondary cities around Turkey are set for a dramatic transformation, as major districts are rebuilt, historic areas renewed and new cities founded. This presents opportunities for the construction sector, even as the magnitude of developments makes it crucial for the government to be transparent and establish clear rules. The most recent impetus for the current “urban regeneration” programme was the 7.2-magnitude earthquake that struck the south-eastern…

Interview

Global expertise: OBG talks to Başar Ar›oğlu, Managing Director, Yap› Merkezi
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Interview: Başar Arioğlu What conditions led to a slowdown in the construction business in 2012, and what is your outlook for the sector in 2013 and beyond? BASAR ARIOĞLU: The construction sector in Turkey has three main business segments: real estate, government tenders, and the market for public-private partnerships (PPPs). The real estate industry declined sharply in 2012 due to oversupply, which made it difficult for housing projects to sell enough units. For 2013, I anticipate that…

Overview

A home for development: Foreign interest continues to support growth in the market
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The real estate sector has been highly dynamic in recent years, with investor sentiment impacted both positively and negatively by a flurry of regulations, new megaprojects and the quarterly health of the economy. At the same time, the country – especially its largest city – has cemented itself as the darling of investors looking for strong returns without all the risks of a less developed market. The investments and decisions made over the next several years will shape Turkey’s urban landscape…

Analysis

Ready for business: Plans are under way for a new financial centre and more malls
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While much attention has been given to Turkey’s residential projects, especially those falling under its urban transformation plan, the office and retail markets are also displaying increased sophistication. The announcement of the Istanbul Financial Centre (IFC), which aims to create a business district on the Asian side, is sparking investment in offices and mixed-use complexes. Istanbul has seen a rapid increase in its office inventory in recent years, but low vacancy rates indicate that demand…