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Estonia's Commercial Real Estate Sector Surges with Major Projects
Construction firm Nordecon has secured a €15.8 million contract to build a major logistics park in Rae municipality, signaling a broader market expansion that includes a nearly fully-leased wooden high-rise in Tallinn achieving record rental prices.
- —Nordecon has signed a general construction contract for the first building of the Park Rae logistics and light industry park in Rae municipality, with construction expected to last 13 months and the first tenants moving in by early 2027.
- —Eften United Property Fund announced a more than doubling of its net profit and revenues in the past year, reaching 3.57 million euros in net profit.
- —The Fahle Terrassid, Estonia's first high-rise wooden office building in Tallinn's Fahle quarter, is nearing completion with 83% of its space already leased, achieving record rental prices for prime locations.
- —The development of Park Rae's first building involves a 32,000 m² structure with approximately 1,200 m² of office space, with construction commencing after the completion of the work project in spring 2026.
- —Eften United Property Fund's assets grew to 29.2 million euros by the end of the previous year, and its net profit represented about 14% of invested capital and 17% of market capitalization.
- —Fahle Terrassid, developed by Neutra Capital, is an eight-story building with 6,920 m² of Class A office space, emphasizing sustainable construction with cross-laminated timber (CLT) and aiming for energy efficiency.
Recap
Three distinct events—a major logistics park contract, the successful leasing of a landmark sustainable office building, and a property fund's doubled profits—collectively signal a robust and forward-looking Estonian real estate market. The convergence of investment in industrial infrastructure and high demand for premium, eco-friendly commercial space points to a maturing sector with strong underlying financial health.