| Where low-cost airlines pioneered, motorways and rail networks have followed – and the increasing mobility between European cities created new property hotspots. Mark Faithfull reports  As French Transport Minister Dominique Perben sped Strasbourg-bound this April at 320 km/h on the inaugural rail journey from Paris on the new TGV-Est, some 3,000 torches lit the way. But the torches could just as easily have been aflame for a new generation of European rail travel, with several countries developing and opening faster networks designed to compete with the ubiquitous no-frills airlines. Their expansion will almost certainly change the property map across important stretches of Europe.
The new TGV (Train à Grande Vitesse) is already one of the world’s speediest rail vehicles. German railways operator Deutsche Bahn, NS Hispeed of the Netherlands, OBB in Austria, SBB in Switzerland, Belgium’s SNCB, SNCF in France and Eurostar have also formed an airline-style alliance called Railteam, with the aim of improving connections, making cross-border timetables and information clearer and enabling through-ticketing. Deutsche Bahn is promoting its striking new Hauptbahnhof station in Berlin as a European hub, while in Brussels modernisation of the Midi station as an international hub serving the Eurostar, TGV, Thalys and ICE services is designed to have the same effect on the EU capital. The Paris-Strasbourg TGV line opened to the public in August and has cut the trip to two hours and 20 minutes from the previous four hours. It has also slashed travel time eastwards, connecting Paris and Luxembourg in about two hours, Frankfurt in less than four and Munich in six hours 15 minutes. The second phase of construction, which will bring the journey time from Paris to Strasbourg down to one hour 50 minutes, is being brought forward from 2010 to 2008. “Some 37 million Europeans can be reached,” says TGV-Est director Alain Le Guellec. “A network of high-speed links with the rest of Europe is being put into place.” Germany’s Deutsche Bahn has sped up many journeys on its own network since the turn of the year and in Spain too journey times are bring slashed by Alta Velocidad Española (AVE), with the high-speed line connecting Madrid and Barcelona in its final stage of construction. AVE will connect with the TGV in 2009 with the opening of the Perpignan-Figueres route, allowing services to go to French destinations such as Marseille and Avignon. Another connection to the TGV is planned at either La Jonquera in Catalonia or Irun in the Basque Country. The AVE Madrid-Lisbon line is currently being constructed and will include an international station on the border near Badajoz. Eurostar moves its London terminus from Waterloo to St Pancras in November, reducing London to Paris journey times from two hours 35 minutes to two hours 15 minutes and London to Brussels times to one hour 51 minutes. Kings Cross/Ebbsfleet Down-at-heel Kings Cross is already a major rail hub for travellers heading to the UK’s north, north-east and Scotland from London, but the arrival of Eurostar is expected to be a major catalyst for rejuvenation. The Kings Cross Business Forum has been created to try and create a strategic framework for the area’s evolution, retaining the local character of the area while incorporating more obvious enhancements such as development of landmark hotel the Renaissance St Pancras. Ebbsfleet, just off junction 2 of the M25, is being established as an alternative to southeast UK airports such as Lydd.  Berlin
Residential property in Berlin has remained at static prices despite the vibrant business and cultural life of the city, although it is often lauded as “the next big thing”. Berlin remains one of the country’s strongest office markets, however. The architecturally striking main station is being established as a hub for intra-Germany and continental travel, while the city is well served by airports. Strasbourg In a double boost, Strasbourg’s connection to London via the Eurostar has been improved and its new super-fast link to Paris will become even speedier next year as the journey time dips below two hours. House prices are expected to increase by as much as 20% when within 30 minutes of an airport served by a budget airline; Reims and Colmar, just to the south of Strasbourg, also look set to reap the benefits. Southern France/ Northern Spain The TGV and AVE will eventually marry up in 2009, connecting cities in France and Spain by rail as well as the extensive motorway network. Eurostar has also reported a near-40% increase in travel between London and Montpellier/Avignon. The connection between Barcelona and Madrid is being accelerated, although recent construction issues have added to a general feeling of discontent in the city about infrastructure projects and government schemes. Barcelona’s residential market has slowed in recent times after becoming Spain’s most expensive property area, and commercial property prices will be boosted by the region’s better connections with Madrid. Southern Spain Spanish rail operator AVE has dramatically reduced travel times from capital Madrid to southern cities Seville and Malaga, opening up the latter in particular as a second/summer home prospect for Madrid residents. Malaga – already preparing for its role as European Capital of Culture in 2016 – is modernising its port to put itself more firmly on the Mediterranean cruise circuit. St Petersburg Europe’s third largest no-frills airline, Air Berlin, began flying between German destinations and Russia’s second city late last year. With massive plans for property expansion under the Open City strategy that will see its port (among other elements) rejuvenated, St Petersburg also joined Moscow as a base for Russia’s first no-frills airline, Sky Express, in April. Competitors have poured scorn on the prospects for Sky Express, but with prices as low as a tenth of Aeroflot’s fares on comparable routes it could precipitate lower-cost connections across Russia.  Phenomenal growth has already been witnessed at Polish regional airports Poznan, Krakow, Katowice and Gdansk, but investors should look further east to Croatia, Romania and the regional Bulgarian airports of Bourgas and Varna, according to agent Donaldsons DTZ. “The skies continue to open in Albania, Ukraine, Turkey and Russia, creating longer-term opportunities for smart investors,” says retail business analyst Colin Burnet.
Croatia has experienced exponential growth on the back of budget airline routes and together with Bulgaria and Romania is likely to record significant growth rates in 2007, with the Bulgarian coastal airports of Bourgas and Varna now under the development of German operator Fraport. In the longer term, Albania’s Tiranë-Rinas airport awaits the arrival of low-cost carriers but is now under foreign ownership and in the midst of a major redevelopment and expansion. Several budget airlines are reported to be investigating airports in Moscow and St Petersburg, and Moscow’s airports are undergoing extensive expansion projects. easyJet now serves Istanbul, and Ryanair is eyeing Turkish airports. But with the skies opening up in Ukraine, several budget airlines circling and the government in the early stages of airport privatisation, Kiev could be the market to watch in the long term, says Burnet. “No hard data exists, but anecdotal evidence suggests that the arrival of a Ryanair or an EasyJet to a region’s airport raises residential property prices by up to 30%,” he says. “When combined with the impact on employment and tourism, this can be the spur to the revitalisation of an entire region’s economy.” |