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Ostrava newsThe D1 highway linking Prague, Brno and Ostrava – the Czech Republic’s three largest cities – has been completed. With a new thirty-kilometre section costing CZK 7.6 billion now in operation, drivers can travel the 385 kilometres from Prague to Ostrava in relative comfort on the highway. — November 2009Ostrava. An industrial centre revived.
In the North American school system students seeking to be the best strive for an ‘A’ grade. However, the school system is not the end of the drive to be the best and earn an ‘A’ grade. Letter grades are used by rating agencies to rank communities in terms of investment risk.
Ostrava, as recently confirmed as 03/2008, received an ‘A2’ grade from Moody’s Investors Service.
What does this mean to you as a potential investor? What are the other indicators which would point to the health and prospects of Ostrava’s property market?
What does this rating actually mean?
There are 25 rankings from Moodys in the investor services, an ‘A2’ is sixth from the top and is defined as an upper-medium grade. A similar grading company, Standard and Poors, also gave Ostrava an ‘A’ ranking based on their grading system.
What will that mean for the city?
Some investors will only look at cities with ‘A’ ratings. It is an indicator of the financial and fiscal health of the community.
Since the restructuring of the industry in the 1990s, the economic platform of the city has changed substantially. In fact, most of its incomes are no longer dependant on local economic conditions.
Ostrava, in receiving this rating, achieved the identical level of rating as other mid-sized cities in Central Europe. Brno, for example, also received an ‘A2’ rating (for a complete discussion of Brno property and economic developments visit our feature on Brno property.)
Ostrava area cities
The Ostrava area boasts a whole number of nearby cities which often have reasons for rapid growth.
A good example of this is Frydek-Mistek, a city of about 60 000 residents. Situated at the base of the Beskydy Mountain range it has served as both a recreational center and more recently, as a real hub of business.
Very close to Frydek-Mistek is Nošovice, the town where Hyundai has decided to setup a new factory. Other satellite businesses have also moved into surrounding areas. It has meant that many Korean and other foreign workers have been looking for high-quality rental properties in the area.
Although these positions will eventually be taken by Czechs with an expected 10 000 employees we feel that the rental market in this city will stay strong for some time.