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May 13, 2016
I’m impressed how quickly we were able to catch up!

Richard Curran, Managing Director CBRE

Interview with Richard Curran for ČSA Review

When I talk to expats working and living in Prague, I always ask them what made them come here in the first place. What is your story?

"I came to Prague in 1994 as a student. Me and a friend of mine did the TOEFL course during our college studies so we were certified to teach English. At the end of the course we were deciding where to go, and we had two options – Milan or Prague. We went to a student travel agency, and simply asked which flight is cheaper. It turned out Prague was about five pounds cheaper to get to. You can say that I got to Prague by accident, and apart from going back to Dublin to finish my college education, I never left."

What were your first impressions of living and working here?

"I was teaching English, working in bars, and generally having a good time. I also met a girl, fell in love and decided to stay here and look for a more serious job. It was offered to me by a friend of mine. He worked for Healey & Baker, who needed a property manager for their expanding residential portfolio. They were renting houses and apartments to high-level managers of international companies based in Prague. My job was basically solving problems and explaining to our clients why it takes three months to get a phone line installed in their very expensive apartment."

As far as I remember that period, it was also the time when the first modern office buildings were being built.

"Yes, it was actually very exciting to be a part of the process. You see, in the 90s international companies were coming to Prague, and they would set up their offices pretty much anywhere, as long as they could get a phone line and a fax machine. As they grew and hired more and more people, they suddenly needed to move to a proper office space. That was the time when the office market suddenly boomed and new offices were being built in Karlín, Anděl and other parts of Prague."

Did you decide to stay in the real estate business because you saw a lot of potential?
"Well, my main motivation was to have a steady job, but it was actually lots of fun and a really exciting time. Back in the UK or Ireland, the real estate market had two or three hundreds years of history, and everything was clearly set. Here we were more or less building up the market as we went. Also, from a personal point of view we had a much bigger opportunity to develop a career. In the UK, you had to spend about three years before you were even allowed to meet a client. Here, you got to go to a meeting on day one, and if you were able to establish a relationship, you got on with it."

Nowadays, our real estate market has at least a few decades of history. Did we move in a different direction than, for example, UK or Ireland?

"Not really. We were able to move so quickly that Prague is now seen by international investors as an advanced market. The clients see us in the same league as, for example, Madrid, Milan or Warsaw. There are also a lot of Asian companies investing here, which was unheard of a couple of years ago. It is quite remarkable that it took such a short time to get to the point when investors are buying big assets, such as Palladium, at yields that you would expect to see in London."

You joined the CBRE company in 2004. What was the real estate market like back then?

"We were a small office of a big international player so we were busy catching up. Fortunately, the market was expanding very quickly. For example, the retail business went from basically zero to full saturation within ten years. One year we had no shopping centres, the next year there were five or six big shopping centres being built every year all around the country."

Looking back at that time, was it a good thing?

"I would say that some developers were not paying enough attention to quality and locations. They were focused on building, and they trusted customers would come anyway. Today, some of the shopping centres are struggling, the buildings have to be re-developed, others are looking for different uses for them. They did not think there is such a thing as too many shopping malls."

The real estate market seems to be very steady – dealing with buildings and plots of land. Did the era of new technologies change it somehow?

"Take the industrial sector, for example. It used to be all about warehouses supplying factories and shops. With the rise of the internet, the big players such as Amazon or Alza and Mall.cz changed the way people shop. Suddenly you need a relatively small retail space but you do need bigger and bigger warehouses. As their selling strategies get more competitive, guaranteeing one day deliveries, they suddenly also need smaller warehouses within the city centre."

How about the changes in the office environment such as flexible offices, people working from home and so on?

"We have been dealing with these trends for quite some time already, because we have a lot of clients in the IT business who are obviously the most progressive when it comes to flexible work environments. Their employees can work on their projects from anywhere, but when they meet at the office, they don’t need or even want to sit separately. They need to communicate, discuss things. That’s why we now spend a lot of time and effort designing meeting rooms, common areas, even relaxation areas. People today don’t want to go to their jobs just to work. They also want to have fun, and we have to listen to them and try to adjust."

Will the more traditional business fields follow the trend?

"I am sure they will. A big part of our services is to work out the ideal working space and we see more and more companies changing their view on that. When a company grows to a certain level, you realize that you simply never use 100% of your desks. Actually we are measuring our own desk usage and we see that the average usage is about 60%. That is why no one in our company has an office or even a fixed desk."

Are there any real estate-specific areas of the Czech Republic?

"Prague is, of course, a very distinct market from the rest of the country. There is quite a successful office market in Brno targeting hi-end R&D and IT support companies, such as IBM, Red Hot or AT&T, that are employing Masaryk University graduates. It amounts to only about 15% of Prague office market though. Pilsen is a huge success story from the logistics point of view. Ostrava is struggling a bit because there was an intention to build an outsourcing hub which didn’t really take off, mainly because the motorway is still incomplete."

Looking back at 1994, did you expect Prague and the Czech Republic to look how it looks now?

"To be honest, I did not have any expectations. Prague in 1994 was beautiful and certainly a lot of fun but everything was difficult – even going to a laundromat, mainly because there was only one. Remembering that, I’m impressed how quickly we were able to catch up with the other major European cities. Everything got easier. The services improved, transport both by air and by train is great, whereas a couple of years ago, boarding a train was a real adventure. So, am I surprised? No, because I didn’t have any expectations, I didn’t even plan that far ahead. But I am pleased how easy it is to live here."

Are we talking about professional life or life in general?

"I would say, life in general. Our family lives quite far from the centre, close to the river. The area was almost deserted a couple of years ago. Today, it is almost too busy with all the cyclists, skaters and people walking by the river. The infrastructure brought the river Vltava back. I remember it as quite a dirty river, now I see people swimming in it every time I walk by."

Do you?

"Well, not by choice. I prefer playing football with my expat team we founded twenty years ago. Back then, we put an ad in some old sport magazine and got so many replies from local village teams inviting us to play them. We still do a big tournament every year in Přední Kopanina, close to Prague Airport. Even if we are a lot older, a lot slower and our team of foreigners is not a novelty anymore, we still have a lot of fun, drinking beer and eating a lot of sausages."