Viennese entrepreneur Avner Motaev is a real estate and telecommunications expert living and working in the Austrian capital. Here he’s built two successful businesses and is passionate about all this unique city has to offer both business and travel visitors. Here he shares his most valuable insights.
Did you start your career in Vienna?
Avner Motaev: Yes, I started working in a small electronics store here in Vienna in 1992, and later set up my own company, mobile2business, in 1999. Now we’re T Mobile’s official business partner.
I also have a real passion for real estate, and in 2005 I set up Immo-Connect to work in developing rental and residential real estate. Now we’re one of the best-known companies for this sort of work in Vienna, with a focus on sophisticated concepts and high-quality materials.
Why did you choose to live and set up your businesses in Vienna?
Avner Motaev: It’s home, and it’s also a great place for entrepreneurs. For example, the Vienna Business Agency runs Startup City Vienna, which provides excellent resources for anyone starting out. There is also the Pioneers organisation, which runs a database of European early-stage startups, offers networking and investment services, and holds events in Austria and Germany.
Vienna is very much at the heart of Europe, and this is reflected in its wonderfully complex and diverse cultural life. So, when you’re not at work, or paying a visit for pleasure, you can start the day in a traditional Viennese coffee house, see plenty of art and history and enjoy our public spaces and end your day eating Turkish street food in somewhere like the Naschmarkt.
This diversity means, while German is the official language, there are big populations of people who speak Turkish, or Slavic languages like Serbian. Also, a lot of people use English as a second language, so in Vienna businesses can offer a wide range of products, service and consultancy to a very broad audience.
How is the mobile phone market developing?
Avner Motaev: It is an exciting time for the mobile phone market, but there are real challenges too. The market is dominated by three big providers, which can discourage smaller companies from trying to compete. Plus, the development of technologies like WhatsApp and Skype makes services cheaper but eats into revenues, which is good news for consumers but tough for providers.
How strong is the real estate market in Vienna?
Avner Motaev: It is a great market to be in, because it is a beautiful city but the prices are affordable when you compare with places like London and Berlin. By the end of the third quarter in 2018, prices had risen about 6.5% year-on-year, and there is high demand for new apartments in particular.
The properties here really are beautiful and relatively affordable and, for me personally, it’s a wonderful place to live, work and raise a family.
How important is local knowledge in this market?
Avner Motaev: Local knowledge is vital. I understand where the best rental yields are, so I can look at whether it’s better to invest in Mariahilfen or Favoriten, for example. There might be good opportunities in Hernals if Innere Stadt is not so strong. One of the best things about the work I do in real estate is the opportunity to explore this great city. Every day I discover something new – it is what I truly love.
What is driving that demand for new apartments?
Avner Motaev: The big underlying driver is that Vienna is a wonderful place to live, and was ranked the best city in the world by the most recent Mercer study. I can see why people have wanted to settle here, historically, because it’s close to the river and the mountains. The same is true today.
This attracts foreigners from places like Russia and Ukraine, who see Vienna in particular as culturally similar to their homelands. But the really expensive properties, in places like Innere Stadt or Margareten, are also being picked up by people from western Europe, Asia, the Middle East and the United States.
What is that you love about Vienna?
Avner Motaev: As a city Vienna is a cultural jewel. It’s rich, diverse and multi-faceted. The music, art and history are outstanding, and there’s always something new to discover. One of my favourite things to do is to explore this beautiful city. Once you’ve enjoyed the big sights like Schönbrunn Palace or the Hofburg, you can discover some real hidden gems.
You can get great coffee, fantastic food and world class music and art. It is also one of the greenest cities in the world. There are wonderful parks like the Lainzer Tiergarten to explore where you can even see wild boar.
What advice would you give to other entrepreneurs who are thinking about making Vienna their base?
Avner Motaev: My first piece of advice if you’re coming into Austria to build a start-up, is to make sure you do your homework. Ensure you tick off the legal requirements and that you make the most of the excellent resources available for start-ups. Second, employ locally! Vienna has a lot of excellent local talent, especially as the city has world class tertiary institutions like the University of Vienna and the Vienna University of Technology.
What challenges do businesses face?
Avner Motaev: There are some challenges for businesses in Vienna, but they depend on where you are coming from and what you are doing. For example, Americans coming to Vienna need to adapt to a more regulated environment than they may be used to.
Another issue to bear in mind is the importance and role of immigration, which is a sensitive and complex subject. For example, one study showed nearly a quarter of Viennese residents who would be otherwise eligible to vote were ineligible because of their foreign citizenship. The city’s population is expected grow to more than 10 million by 2050, but would shrink without immigration. Anyone starting a business here needs to be aware of this backdrop if they want to succeed.
What advice would you give to a beginner looking to invest in real estate?
Avner Motaev: The most important thing is to look for where you can add value.
You have to learn to spot areas where rental yields are steadily and naturally increasing, so you can focus on buying there while it is still affordable. A local real estate agent can help you to avoid properties with inflated values.
One option is to look for commercial units that need you to add value in some way, because it makes the units more attractive.
There are a number of challenges ahead to be mindful of too. One of the biggest I think will be the outcome of Brexit, because it has the potential to have a big impact on rental markets.
This is because Brexit could well see up to 132,000 workers returning to the EU from their current jobs and lives in the UK. They will need somewhere to live, which could boost the rental markets in places like Hungary and Poland.
But we need to be wary of the risks this poses as well. If building doesn’t keep pace with demand, we could have an affordability problem. This is happening in the US, where more than half the real estate properties in the US’s top 50 markets are seen as overvalued.
What’s the best bit of advice you’d give to a young Avner Motaev?
Avner Motaev: I would probably give my younger self five pieces of advice: challenge yourself every day, believe in yourself, be more afraid of not trying than of failing, know your goals and learn from your mistakes.
Avner Motaev is a real estate investment and telecommunications expert living and working in Vienna. You can visit his website at http://www.avner-motaev.at