Ten years ago, Lithuania was scarcely known in Western countries. Though awareness of the country grew when independence from Russia was restored in 1991, the interest in Lithuania among holiday makers and property buyers abroad significantly increased only after its joining the EU and NATO.
Located between Latvia, Belarus, Poland and Kaliningrad, Lithuania is easily reached by cheap Ryanair and Lithuanian Airlines flights. However, it still differs from many other European destinations: no over-crowded roads, marvellous architecture, unspoilt landscapes, and comparatively low prices.
The capital city Vilnius lies conveniently only 25 km from the site which, in 1989, was named by the French National Geographic Institute the centre of Europe. Real estate buyers also choose Vilnius as a city known for its beauty of architectural styles in the Old Town area and the scenic outskirts.
During the year 2006, the commercial lodging market, except for single cases, was stable and price fluctuations were not very significant in Lithuania. The prices vary depending on the location (city centre, prestige or residential area) and the age of the building. Besides, lodgings on the ground floor tend to be more expensive.
For sale, the average commercial lodging prices in the biggest Lithuanian cities such as Vilnius, Kaunas and Klaipeda vary from 3,000 to 5,500 LTL/m2. The average price of office accommodations in the three mentioned cities is about 3,000 LTL/m2 (the prices also differ depending on the class of office). Industrial lodgings cost from about 1,000 to 2,200 LTL/m2, meanwhile storehouses from 950 to 1,800 LTL/m2.
For rent, the average commercial lodging prices fluctuate between 50 and 90 LTL/1m2 per month. Office accommodations cost around 30 LTL/1m2, industrial lodgings from 11 to 20.6 LTL/1m2, and the prices of storehouses vary from 11.6 to 23.5 LTL/m2.
When it comes to the location of business, Lithuania has Free Economic Zones, one in Kaunas and one in Klaipėda, where business people are offered exceptionally favourable conditions for doing business. Incentives in these zones include: no corporate tax for the first 6 years and a 50% corporate tax break for the next 10 years (applicable for investments exceeding EUR 1 million); no land, road, or real estate taxes; and an extensive application of 0% VAT. On the whole Lithuania takes a high position among the most business-friendly countries of the year 2006-2010 (rate No. 35).
Foreign direct investments in real estate rocketed in 2005, and the economy in the country is still speedily developing. Real estate investors are mostly interested in office accommodation and retail lodgings in central areas of the biggest cities. Among the present and prospective investors in real estate are large Finnish, Norwegian, Russian, German and other companies.
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