Well, that went fast’ is a phrase that when the dust had settled at the end of 2023 the team at REassurance stopped and took a moment to look back on the year that had just passed and the year ahead. This edition of our usual January newsletter is a little bit delayed as we have got off to a very busy start to the year in 2024. We have a new mantra at REassurance for the year ahead which is ‘Let’s Do More in ‘24’. It started as a tongue in cheek riposte to the negativity of the sentiment we had encountered at some of the events, seminars and conferences we attended throughout the year. The ‘Survive until ‘25’ or ‘Higher for Longer’ that we all heard at EXPO back in October felt too negative for us, we wanted to think positive, we wanted to create some energy and we wanted to keep improving. On that basis ‘Let’s do more in ‘24’ became our fun way of pushing on to the next level of our growth.
Followers of our LinkedIn page will know that REflections is our way to share our news and recap on our year as well as share our views and expectations for the year ahead. There is no doubt that 2023 was an incredibly challenging year across the real estate and CEE markets. The numbers don’t lie, and it was clear to see that although headline numbers might have picked up a bit from the disappointment of 2022 in some jurisdictions, it was clearly still tough times for others. Investment volumes of under €500million in Hungary, just over €2billion in Poland and €1.1billion in Czech are a long way from the market highs we saw in 2019 when it was vastly different economic landscape. We are all aware of the numerous factors that have led to this downturn, interest rates, inflation, energy costs, war, but how does the year ahead look and more importantly, what were the positives that could be taken from 2023?
We are pleased that we were able to increase revenue, increase headcount, increase the number of countries we supported transactions in and increase the quality of our services. We have covered previously our expansion into tax insurance, and we have been overwhelmed by the growth of this product line. It remains a product that many have yet to experience, but with Karol Iwanowski driving our tax practice at REassurance, we have a very strong role to play in the growth across CEE and beyond. Karol has helped many clients with both their new transactions as well their existing continuing business matters, when tax issues have arisen. In October we continued with our underlying ethos to have local people in local markets, and we were delighted that Anna Vondrackova decided to join us in Czech Republic. We have long felt that the Czech market needed its own individualized touch, an understanding of the market dynamics and a strong character to build on the growing domestic marketplace. The Czech market also now boasts home to some of the CEE regions biggest investors. While Poland still struggles to develop its own domestic market, the Czech market is creating a very different marketplace. It is with these changing markets dynamics that Anna joined us.
Bringing an excellent background as a real estate lawyer, staying close to our founding principles, Anna has adapted quickly to the insurance world and already been involved in some of Czech’s biggest transactions in 2023. Into 2024 will see Anna and the team running a series of W&I, Title and Tax workshops for leading lawyers and advisors as we again try to add value and develop market knowledge. Anna also allows us to connect local relationships and strengthen our footprint across CEE.
Looking ahead we see 2024 as a year of further growth and opportunity for REassurance. While the headline numbers may be lower than before, it would be wrong to say that there are not investors. It’s quite apparent to us that there are new players keen to take advantage of a more opportunistic environment. Equity buyers come to the forefront, transactions that perhaps previously were deemed too complicated or too challenging now present good opportunities, coincidentally this drives the need for insurances, assets that might have historic defects, distressed assets with no substance or an inability to meet the usual representations and warranties all present opportunities for us. We are seeing buildings being repurposed, change of use permit applications, IP rights and many other novel issues which we can support. We may have lost the headline, prime, class A transactions in the office market, but elsewhere there is vibrant market in the BTS, logistics, student housing sectors amongst others. Twelve months ago, we thought we may see a return to retail, and this is slowly beginning to be felt across CEE.
Expanding our range of services saw us focus on REnewables last year, our own line dedicated to supporting the growing renewable energy sector. While the CEE market operates under quite different local legislations, we have been encouraged by activities in Poland and Romania. This has seen us involved in several photovoltaic and windfarm transactions. We expect to see more transactions in this sector in 2024 and the team will be attending a number of ‘green energy’ events throughout Europe.
On the subject of expanding services, we are also pleased to have started in 2023 to undertake a number of M&A transactions. Our experience and the trust of our clients in the talents of our transactions team led by Katarzyna Lawinska has helped us grow in this interesting new direction and we hope that this year we will further add to the team with a dedicated M&A professional to build out an M&A practice within REassurance. Added to that, we see growth in new jurisdictions and have our plans in process for some exciting new hires and interesting markets.
Of course, the culture at REassurance means it’s not all work, work, work and one of the reasons for delay in this edition of our newsletter was to complete our first REassurance Padel Cup which we hosted in Warsaw recently. Padel is the fastest growing sport in Europe and has a growing fan base amongst our clients. We were really excited to bring this tournament together hosting thirty-two players from sixteen teams and a mixed background of lawyers, investors, developers and advisors for an afternoon of competition, fun and networking. It also helped that it fell on ‘Fat Thursday’ so a few donuts were enjoyed too!
No doubt the first half of the year will continue to race on at full speed, January has already seen us add to the team in Poland and we welcomed Alicja Kwiatkowska to REassurance. Alicja is a UK qualified solicitor with experience gained at Dentons and Greenberg Traurig. Alicja is a great addition and we hope to see her flourish. Not resting after out Padel tournament we will be in Prague to support Anna and will be undertaking a number of workshops in February, before the annual trip to Cannes and MIPIM in March and trips to Bucharest, Vilnius later in April and May. Couple that with a few ski/snowboard trips for the team, an ongoing recruitment process and a growing number of transaction mandates we really are aiming to fulfil our mantra – Let’s do more in ‘24’!