Rental levels are beginning to bottom out in most of the core Central and Eastern European markets and stability should return during 2010 once the supply and demand levels rebalance, according to Jones Lang LaSalle.

Commenting in the EE City Reports Q3 2009, John Duckworth, managing director of Jones Lang LaSalle in the CEE said: 'As the world enters economic recovery and banking systems mend, real estate markets are doing their own healing, but at markedly different paces.

'In Europe, improving investor sentiment is driving activity for a specific band of prime real estate. Development pipelines continue to shrink or slip as financing remains difficult to obtain or is still currently too expensive to make sense. Occupier activity across all sectors has slowed compared to previous years as similar financing issues prevent or delay relocation and expansion plans,' He said.

Duckworth added: 'Rental levels are beginning to bottom out in most of the core CEE markets and we expect stability to fully return throughout 2010 once the supply and demand levels rebalance.'

Poland is still forecast to be one of the few, if not the only country in Europe, to have positive GDP growth during 2009, with the Czech Republic following in mid-2010. Romania and Hungary are forecast to follow towards the end of 2010. These green shoots of recovery in the economy will still take some time to filter into the real estate markets however, forecasts also suggest that the core CEE4 countries will gather momentum in 2011 and register average year-on-year growth of over 3% which is somewhat higher than the EU15 forecast of 1%.